Construction firm owner arrested for alleged workers comp fraudReprints
A Florida construction company owner could face up to 30 years in prison over an alleged workers compensation scheme involving a fake company and fraudulent financial transactions, the state’s chief financial officer, Jeff Atwater, announced Thursday.
An investigation by the state’s Bureau of Insurance Fraud revealed that Leon Jimenez, owner of Orlando, Florida-based Chuy Construction Inc., allegedly operated a shell construction company for the sole purposes of selling the company’s workers’ compensation certificate, according to a statement from Mr. Atwater’s office.
The investigation was launched after the bureau received a tip from the Florida Carpenter’s Union alleging that Mr. Jimenez, known as Chuy, might be engaged in illegal activity.
Investigators discovered that Mr. Jimenez had provided false information on the company’s workers’ compensation application, claiming that Chuy Construction employed 50 people who performed drywall and other basic construction services across Central Florida, according to the press release. However, between August 2014 and May 2015, investigators tracked more than $2 million in payroll that had been cashed by at least 140 employees.
The investigation later found that Chuy Construction was not performing any construction work whatsoever but rather selling its workers compensation certificate to other subcontractors in exchange for payment. In doing so, subcontractors evaded the law and left employees vulnerable to costly medical expenses and lost wages in the event of on-the-job injuries, according to Mr. Atwater’s office.
Meanwhile, Chuy Construction’s workers comp insurer was defrauded of more than $160,000 between August 2014 and May 2015, according to the statement.
Mr. Jimenez, who was arrested May 22, has been charged with two counts of workers compensation fraud, failure to secure coverage, false document as proof of coverage, false or misleading statements to diminish/avoid premiums, conceal payroll, application fraud and scheme to defraud. He has also has been charged with one count of grand theft, according to the statement.