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Man ordered to pay $4.2 million for workers compensation fraud

Man ordered to pay $4.2 million for workers compensation fraud

A Fresno, Calif., man has been ordered to pay $4.2 million in restitution to workers compensation insurers after he pleaded guilty to felony insurance fraud, the California Department of Insurance said Thursday.

Richard Lopez Escamilla Jr. also was sentenced Wednesday in California's Kings County Superior Court, the department said. He was accused of illegally reducing his workers comp premiums by underreporting employee payrolls for his farm labor contracting company, as well as misrepresenting previous comp claims for the firm.

Mr. Escamilla's restitution will be paid to SeaBright Insurance Co., the California State Compensation Insurance Fund, and the California Employment Development Division, the state said. He also was sentenced to six years in prison

“This is a win for California consumers, insurers and taxpayers,” California Insurance Commissioner Dave Jones said in a statement Thursday. “This case isn't just about one crook who stole from two insurance companies. Business owners across the state end up paying the real price for workers' compensation fraud through higher premiums and those costs are passed to consumers.”