Insurance Fraud NEWS
New York contractors accused of lying they have no employees
April 16, 2019, Albany, NY
Two Albany contractors have been arrested, accused in a scheme to avoid paying workers' compensation insurance related to a roofing job in Amsterdam, the state Inspector General's Office said Tuesday.
Jose A. Sanchez, 50, of Putnam Street, Albany, owner of Sanchez Partners Construction, and Leroy E. Nelson, 38, of Third Street, Albany, owner of JRN Construction, were each arrested and charged with first-degree offering a false instrument for filing, a felony. Sanchez also faces a misdemeanor count of failure to secure workers' compensation.
They are accused of filing fraudulent applications with Amsterdam's building department for a roofing project on Pulaski Street in Amsterdam as part of a workers' compensation fraud scheme, officials said.
The incident began in late October and November as Amsterdam's engineering department issued stop work orders on the Pulaski Street project for lack of a building permit, officials said. Sanchez then applied for a permit Dec. 5 and submitted a document indicating he had no employees and was not required to purchase workers' compensation insurance.
The Inspector General's Office investigation, however, determined Sanchez had several employees working on the project, meaning workers' compensation insurance was required, officials said.
Sanchez was denied the permit upon his application. Nelson then applied for a permit on the same project the next day. He indicated his company, which had workers' compensation insurance, would perform the work. Investigators determined that Sanchez' company continued the work without involvement from Nelson's company, officials said.
Nelson previously pleaded guilty in 2016 to a forged instrument count related to a falsified workers' compensation certificate of insurance, officials said.
"These two contractors, one of whom with a recent history of fraud, chose a course of deception over honest business practices," Inspector General Catherine Leahy Scott said in a release. "My office and our local and State enforcement partners will not tolerate any corruption of a critical benefits program meant to protect honest hard-working employees."
Sanchez and Nelson were arraigned and released to return to court later.
Source: The Daily Gazette