For release on April 16, 2014
CONTACT: CONSTRUCTION COMPANY OPERATORS CHARGED WITH WORKERS’ COMPENSATION FRAUD
Christopher Kwok, Deputy District Attorney
Insurance Fraud Unit/Economic Crimes Group
After investigations by the Santa Clara County District Attorney’s Office, operators of two South Bay construction companies have been charged with felony workers’ compensation fraud. Both underreported the number of their employees to insurance companies and ended up paying a combined total of $300,000 less in premiums. Sandra O’Neill, 44, and William O’Neill, 34, both of Cupertino, of Sunnyvale’s WM O’Neill Lath and Plastering Company, have been charged with four felony counts of workers’ compensation insurance fraud. They are scheduled to be arraigned on April 22. If convicted, the O’Neills face a maximum of 10 years incarceration. Teofilo Oceguera, 62, and Sara Oceguera, 60, of Sunnyvale, are charged with two counts of workers’ compensation insurance fraud, six counts of unemployment insurance charges and five counts of false income tax return charges. They will be arraigned on April 28. They face a maximum of 18 years of incarceration. All defendants will be ordered to pay full restitution. “It is hard for honest business owners to compete with unscrupulous people that illegally lower their operating costs by committing insurance fraud,” Deputy District Attorney Christopher Kwok said. “A leveled playing field protects all California businesses and their workers.” California law requires all businesses that have employees to maintain workers’ compensation insurance. The assessed insurance premium is based on a number of factors, including the nature of the business, safety record, and the employees’ wages reported by the employer. It is alleged that between 2009 and 2013, the O’Neills grossly under reported their payroll to four different insurance companies in order to fraudulently reduce their workers’ compensation insurance premium. The alleged illegal actions by the O’Neills caused an estimated total loss of over $200,000 in premiums. After a separate investigation by the District Attorney’s Office, the Employment Development Department and the Franchise Tax Board, the operators of Teo’s Roofing were arrested April 15, 2014. It is alleged that between 2009 and 2011, the Ocegueras failed to report a payroll to the State Compensation Insurance Fund. It is estimated that the Ocegueras owe more than $100,000 in premium and taxes to State Compensation Insurance Fund, EDD and FTB. In the past four years, the D.A.’s Office has obtained 216 workers’ comp convictions, secured $5.9 million in victim restitution orders, and recovered $4 million in restitution.