Calif. business owner charged in $2.5M workers' comp fraud
A father and daughter face felony charges for allegedly underreporting employee payroll to reduce workers' comp premiums.
Felipe Saurez Barocio, owner of Agriculture Services, Inc., and his daughter, Angelita Barocio-Negrete, face multiple felony counts of insurance fraud in a workers’ comp scheme, reported the California Department of Insurance (DOI).
The alleged illegal act potentially left employed farmworkers unemployed and at financial risk, said the DOI.
“When businesses illegally underreport payroll and employees, they create an unfair advantage that places legitimate businesses at a competitive disadvantage,” said Insurance Commissioner Ricardo Lara in a release. “We all pay the price for insurance fraud through increased costs for services and higher premiums.”
In October 2019, the State Compensation Insurance Fund (SCIF) filed a claim with the DOI stating Barocio and Barocio-Negrete, who worked as the office manager, underreported employee payroll by $11 million to fraudulently reduce the workers’ compensation premium for Agriculture Services, Inc. by over $2.5 million.
An investigation by the DOI found that Barocio and Barocio-Negrete provided SCIF with falsified employee payroll reports that omitted $11 million in actual payroll, resulting in a total loss of $2,582,142 in insurance premiums.
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