Contractor charged with insurance fraud; San Diego company underestimated payroll by $500,000 to illegally cut insurance costs.SAN DIEGO--(BUSINESS WIRE)--Oct. 25, 1995--Department of Insurance fraud investigators arrested a San Diego-area contractor late Monday on charges of insurance fraud and grand theft after he allegedly failed to report his payroll by nearly $500,000 to illegally reduce his workers' compensation workers' compensation, payment by employers for some part of the cost of injuries, or in some cases of occupational diseases, received by employees in the course of their work. insurance costs. Michael Hooper, 46, of Escondido, was held in lieu of $100,000 bail on the charges after the Grand Jury handed down a 12-count indictment against him late Monday. The indictment, unsealed in an arraignment A criminal proceeding at which the defendant is officially called before a court of competent jurisdiction, informed of the offense charged in the complaint, information, indictment, or other charging document, and asked to enter a plea of guilty, not guilty, or as otherwise permitted today, also includes tax evasion The process whereby a person, through commission of Fraud, unlawfully pays less tax than the law mandates. Tax evasion is a criminal offense under federal and state statutes. A person who is convicted is subject to a prison sentence, a fine, or both. charges. Between June 1991 and October 1993, Hooper reported his employee payroll as $20,000 to his workers' compensation insurer, the State Compensation Insurance Fund The State Compensation Insurance Fund (SCIF or State Fund) is a workers' compensation insurer that is operated as a public enterprise created by the U.S. state of California. . An audit by the Employment Development Department based on records seized by the Department of Insurance later revealed that Hooper's actual payroll for that period totalled at least $519,163. By misrepresenting his employee payroll, Hooper avoided paying at least $412,800 in insurance premiums. "This is a new twist to an old crime," said Insurance Commissioner Chuck Quackenbush Charles "Chuck" Quackenbush (born 1954) is a Florida law enforcement officer and former California politician. He served as Insurance Commissioner of California from 1995–2000 and as a California State Assemblyman representing the 22nd District, from 1986–1994. . "While most workers' comp fraud cases involve employees faking injuries or attorneys and doctors teaming up to run medical mills, under-reporting payroll to cut insurance costs is the same sort of crime, and contributes to the multi-billion fraud problem that caused insurance costs to rise in the first place." CONTACT: California Department of Insurance The California Department of Insurance (CDI), established in 1868, is the angency charged with overseeing the regulation of insurance regulations, enforcing statutes mandating consumer protections, educating consumers, and fostering the stability of insurance markets in the state , Los Angeles Candysse Miller, 213/346-6367 or Richard Wiebe, 916/324-2515 |
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