Construction company operators plead to $6 million workers compensation fraud and labor theft scheme
A brother and sister who run a construction company in Southern California have admitted to their roles in a $6 million criminal workers’ compensation fraud and labor theft scheme. The case is being prosecuted by the Los Angeles County District Attorney’s Office.
Enrique Vera, who owns Ultimate, Inc., pleaded no contest to one felony count each of workers’ compensation fraud and grand theft of labor. Gloria Vera, the company’s office manager, pleaded no contest to one felony count each of workers’ compensation fraud and insurance fraud.
They both admitted an allegation of committing fraud and embezzlement that resulted in a loss of more than $500,000 to the State Compensation Insurance Fund. Under the terms of the plea agreement, the defendants must pay restitution of $6.3 million and more than $5,000 in investigative costs to SCIF. They also are required to pay $30,000 in fines, have one year of electronic monitoring, complete 500 hours of community service and comply with SCIF in future business dealings. Failure to comply with the terms of the plea agreement could result in a sentence of eight years and eight months for Enrique Vera and nine years for Gloria Vera.
According to the prosecutor, the siblings submitted altered payroll records to SCIF in order to pay a reduced premium on the construction company’s workers’ compensation. Gloria Vera failed to disclose and concealed employees’ on-the-job injuries that entitled them to workers’ compensation. Enrique Vera underpaid employees the required prevailing wage as a contractor for a student housing renovation project at UCLA. Ultimate was previously debarred from working on public works projects by the State of California Labor Commissioner’s Office.
Ultimate has performed work on multi-family residential projects throughout Los Angeles and Orange Counties. They have worked on projects for major companies, including Jamison Properties/Wilshire Construction, Philmont Management, Fassberg Contracting Corporation, Sinanian Development and Frost/Chaddock Developers.