A California brother and sister who owned a landscaping service won’t contest charges that they duped several workers’ compensation carriers out of more than $200,000.
Michael George Mello Jr., 37, and his sister Mary Catherine Rodriguez, 38, owners of Sacramento, Calif.-based Green Valley Landscaping Services, plead no contest late last week to insurance fraud and tax evasion.
Between July 2010 and July 2013, the siblings allegedly conspired to commit workers’ comp premium fraud by significantly underreporting the number of employees and payroll in their business.
In total, the defendants cheated workers’ comp carriers out of $144,672 in premiums and the Employment Development Department out of $110,462 in payroll taxes.
“The underground economy is not a victimless crime,” California Insurance Commissioner Dave Jones said in a statement. “Not only were numerous people in this case put at risk, but every consumer and legitimate business pays the price for workers’ compensation insurance fraud as insurers pass their losses on to policyholders and businesses then pass their increased costs to consumers.”
Mello was sentenced to 30 days county jail, five years formal probation and ordered to pay $144,672 in restitution to insurance companies and $110,462 to the EDD. Rodriguez was sentenced to three years of probation, 50 hours of community service and order to pay the EDD $110,462 in restitution jointly with her brother.
This case is a result of a joint investigation by the department’s Fraud Division, EDD and the Department of Industrial Relations. The Sacramento District Attorney’s Office prosecuted this case.
Topics California Fraud Workers' Compensation
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