Federal authorities executed search warrants at 14 Zipps restaurants in the Phoenix area on January 26, following a year-long investigation into illegal employment practices, identity theft, and document fraud. The operation was conducted by Homeland Security Investigations (HSI) and IRS-Criminal Investigation.
Diego Gonzalez-Rosales, a 36-year-old Mexican national residing illegally in the United States, has been charged with several offenses including knowingly employing unauthorized aliens, making false attestations on Form I-9, transferring means of identification without authority, and aggravated identity theft. Gonzalez-Rosales is accused of recruiting and hiring undocumented workers for kitchen staff positions across all Zipps locations in Arizona. Authorities allege he used fraudulent identification documents to verify their eligibility through the E-Verify system.
Three other employees—Edwin Flores Rosales, 28; Salvador Villenueva-Rosas, 48; and Ludwin Benjamin Perez Velasco, 22—were also charged with lying on Form I-9 by falsely claiming U.S. citizenship and using fake identification and social security numbers.
During the operation, law enforcement took into custody a total of 39 individuals who were unlawfully present in the United States and working at Zipps.
According to court documents, HSI served notices of inspection to all Zipps locations and corporate headquarters in March 2025 after receiving information that employees might be using fraudulent documents to pass E-Verify checks. Review of company records indicated misuse of names, social security numbers, and dates of birth to obtain employment.
Investigators identified suspicious wage patterns among 76 employees who appeared to have multiple active employers besides Zipps Sports Grill during the second quarter of 2025. These individuals had certified themselves as U.S. citizens on their Forms I-9—a status that does not require listing an Alien Registration Number—and reportedly earned unusually high wages within the same quarter. Such patterns are consistent with aggravated identity theft.
Gonzalez-Rosales is alleged to have facilitated these actions by knowingly employing undocumented workers and assisting them in misrepresenting their citizenship status on official forms.
Authorities emphasized that “A criminal complaint is simply a method by which a person is charged with criminal activity and raises no inference of guilt. An individual is presumed innocent until evidence is presented to a jury that establishes guilt beyond a reasonable doubt.”
The ongoing investigation is being led by HSI Arizona with support from IRS-Criminal Investigation and the U.S. Marshals Service. The U.S. Attorney’s Office for the District of Arizona is prosecuting the case.
Further details about the U.S. Attorney’s Office for the District of Arizona can be found at http://www.justice.gov/usao/az/.
