An Orange County staffing company owner and three others were arrested Thursday on a federal indictment alleging they cheated the Internal Revenue Service out of more than $90 million, money prosecutors say was used for the purchase of homes, rental properties and luxury vacations in Hawaii, Tokyo, Paris, Dubai and elsewhere.

Lorena Padilla, 49, of Villa Park, the case’s lead defendant, is charged with one count of wire fraud conspiracy, one count of money laundering conspiracy, and six counts of failure to account for and pay over employment taxes, according to the U.S. Attorney’s Office.

She is expected to make her initial appearance and be arraigned Thursday afternoon in U.S. District Court in Santa Ana.

Also arrested and scheduled for arraignment Thursday in Los Angeles federal court are:

— Selina Medina Preciado, 30, of Whittier, Padilla’s daughter

— Carlos Padilla, 40, of Chino, Lorena Padilla’s brother

— Pablo Araque, 55, of Downey

Two other defendants charged — Melanie Medina, 31, of Yorba Linda, who also is Lorena Padilla’s daughter; and Susana Cardenas, 45, of Long Beach — are expected to appear in federal court in the coming weeks. Law enforcement is looking for defendant Janine J. Garcia, 39, also known as “Janette Ortega,” of Seal Beach.

Federal prosecutors allege that along with tax fraud, the defendants defrauded numerous clients by failing to pay employment taxes withheld from the wages of temporary workers — many of them described as undocumented immigrants — and used the unpaid taxes to fund their luxurious lifestyles. Some of the defendants documented their extravagant lifestyles on Instagram and other social media, according to the U.S. Attorney’s Office.

Lorena Padilla controlled several businesses based in Los Angeles and Riverside counties: Platinum Staffing in Montebello, Payroll Staffing Solutions Inc. in Industry, Three Star Global Inc. in Corona, and Next Level Staffing in Maywood, authorities said.

The companies provided workers and human resources services to client businesses in various industries in the Los Angeles area. For all temporary workers staffed with clients, the companies claimed to provide payroll tracking, paycheck preparation and distribution, the withholding and payment of payroll taxes to federal and state authorities, the preparation and filing of quarterly federal employment tax returns and the maintenance of valid workers’ compensation insurance.

According to the indictment, from January 2012 to September 2024, the defendants allegedly defrauded the staffing companies’ customers, the IRS, and California’s Employment Development Department, the California state agency responsible for collecting California employment taxes.

To conceal their failure to report employee wages and taxes and pay employment taxes, Padilla, Garcia, Medina and Preciado caused Next Level Staffing to hire large numbers of undocumented immigrants as temporary workers, prosecutors contend.

The defendants anticipated the undocumented immigrants would be less likely to file federal income tax returns and be less likely to alert the IRS to Next Level’s ongoing failure to account for and pay over employment taxes, court papers show.

The U.S. Attorney’s Office alleges that from 2020 to 2025 alone, the defendants collectively understated the staffing companies’ federal employment taxes by more than $44 million. Total losses to the U.S. Treasury from the scheme exceed $90 million, prosecutors said.

Lorena Padilla and several other defendants used the ill-gotten gains for personal expenses and purchases, including properties in a trio of Southern California counties — a $3 million ranch in Riverside, a $2.5 million home in Whittier and a $3.5 million home in Yorba Linda, federal prosecutors say.

The defendants also allegedly purchased rental properties in Ontario and Corona, went on luxury family vacations in Hawaii, Tokyo, Paris, Dubai, Italy, and Aspen, Colorado, hired musical acts to perform at a joint birthday party for Preciado and Medina in October 2021, and bought Lamborghinis and Rolls-Royces, according to court papers.

If convicted as charged, the defendants would potentially face decades in federal prison, prosecutors said.