A New York asbestos contractor failed to pay $1.6 Million in workers’ compensation premiums and will serve four years in prison. Upon his release he will be deported to his home country as he is an illegal immigrant.
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To complicate the issue the employer used a number of “schemes” lasting over ten years, to avoid detection and premium payments.
1. He claimed to have only one employee – an office worker. Using this false data insurance companies charged far lower rates than if the true number (dozens) of his employees and the hazardous nature of their work was known.
2. He repeatedly changed the name of his company.
3. He classified his asbestos-removal workers as independent contractors. Visit https://blog.reduceyourworkerscomp.com/?p=474 to review IC rules.
4. He filed a report stating he had NO workers!, triggering an immediate investigation!
In addition to the prison sentence, restitution for unpaid premiums to three separate carriers was negotiated in a plea agreement. The amounts are: $1,067,265 to the New York State Insurance Fund, $345,904 and $238,187 to private insurance companies.
According to William Gurin, inspector general for the New York State Workers’ Compensation Board,
the amount of employer-premium fraud in this case exceeded the amount from all such cases brought last year by the Workers’ Compensation Board. Premium fraud in the construction industry is very high because dangerous jobs equals high workers’ compensation premiums.
The NYCSWCB is changing the focus of investigations to focus more on health care provider fraud and employer premium fraud to make it clear the law is being enforced Mr. Gurin said.
Extracted from: New York Times by Steve Greenhouse, 7/28/2009
This blog originally appeared on the LexisNexis Workers’ Compensation Law Center.
Reposted with Permission Visit LexisNexis for more information and full reports.
http://law.lexisnexis.com/practiceareas/Workers-Compensation-Law-Blog/Workers-Compensation/Workers-Comp-Fraud-Blotter-7302009
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