Workers’ compensation fraud charges lead to guilty plea by contractor

TAMPA, FL – The 24-year-old Tampa construction company owner pleaded guilty to one count of conspiracy to commit wire fraud by making false statements regarding the payment of a workers’ compensation for employees and the employment of undocumented immigrants.

Tampa’s George Garcia faces a maximum sentence of 20 years in federal prison. A sentencing date has not yet been set.

According to the plea agreement, Garcia owned and operated a construction company that he registered with the state of Florida in October 2018. This company provided construction services and labor to construction contractors. . To comply with Florida law, Garcia’s company was required to obtain and maintain adequate workers’ compensation insurance coverage.

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Workers’ compensation insurance providers base the premiums they charge and the amount of coverage they provide on the number of employees a company has and the total annual payroll of those employees.

Garcia’s company had agreements with contractors and subcontractors to use its workers on construction sites, but those workers were often undocumented immigrants who worked for and under the contractors’ day-to-day supervision and direction, according to the affidavit. Garcia or others regularly received “paychecks” from contractors which were cashed at various financial institutions to pay so-called “employees” of Garcia and other related expenses.

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The affidavit states that Garcia falsely stated in the insurance applications that his company had a very limited payroll and a very limited number of employees who worked on construction sites. Garcia also wired communications to numerous contractors falsely stating that his company’s employees had full workers’ compensation coverage.

In fact, Garcia’s company received and cashed over $19 million in checks from various construction contractors for these so-called “employees.” This payroll figure far exceeded the very limited payroll figures that Garcia had reported to his workers’ compensation insurance company.

As a result, employees of Garcia’s company performed work on construction sites without adequate insurance coverage. Additionally, insurers lost the premiums they would have charged if they had been aware of the actual number of workers their policies were being manipulated to cover.

Garcia’s company also denied responsibility for ensuring that workers at the site were legally authorized to work in the United States and that required state and federal payroll taxes were paid for those workers. Entrepreneurs who actually paid the wages of these workers and used their services could therefore avoid these taxes.

This matter was investigated by Homeland Security Investigations and the Florida Department of Financial Services. He is being prosecuted by Assistant United States Attorney Jay L. Hoffer.

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