Restaurant chain Tale of Spice claims the business is the victim of a vendetta after three restaurants were raided by Home Office immigration officers on Friday.
Twelve staff were arrested at Tale of Spice restaurants in Chippenham, Trowbridge and Pewsey following a tip off.
It follows a raid on Tale of Spice II in Westbury in February when six Bangladeshi men were arrested.
Shippon Rahman, franchise holder for the Trowbridge restaurant, said: “We have done nothing wrong.
“Some people are jealous of us because we have a good name and some of our rivals must feel that they can get more business by giving us bad publicity.
“I think it is strange that they did all my branches at once. I think one of our competitors want to make us look bad.”
The Home Office said that six men were arrested at the Chippenham restaurant. Four, aged between 28 and 35, had overstayed their visas, a 25-year-old had entered the country illegally and a 30-year-old was said to be working in breach of his visa conditions.
At the Trowbridge restaurant, four men were arrested with three, aged 27, 38 and 49, said to have been overstaying their visas with a 28-year-old working in breach of his visa conditions.
In Pewsey, two men, aged 23 and 27, were arrested for overstaying their visas.
Four other men, aged between 30 and 64, had overstayed their visas but were not arrested.
Seven of those arrested were transferred to an immigration detention centre for potential extradition out of the country.
The rest were placed on immigration bail while their cases are investigated.
But Mr Rahman claimed the staff, all from Bangladesh, have now been released and they were only arrested because they weren’t carrying their paperwork which allows them to work in Britain.
Mr Rahman said: “We have no illegal workers, the issue was that they weren’t carrying their passports which shows their working conditions.”
However a Home Office spokesman said: “We won’t say anymore at this stage but the business now has around three weeks to provide evidence that correct checks have been carried out.”
The business was also served notice that it could face a civil penalty of up to £10,000 per illegal worker found unless proof is provided that the correct right-to-work checks were carried out.
Kenny Chapman, head of the South West Home Office Immigration Enforcement team, said: “Employers who use illegal labour are defrauding the taxpayer, undercutting genuine employers and denying legitimate job hunters work.
“We’re happy to work with employers who want to play by the rules but those which continue to flout them will face heavy financial penalties.”