San Jose man pleads no contest to insurance fraud, money laundering charges
For release on July 5, 2023
CONTACT:
Mattia Corsiglia
Rebecca Charlesworth
Deputy District Attorneys
Insurance Fraud Unit
(408) 792-2526
San Jose man pleads no contest to insurance fraud, money laundering charges
A 52-year-old San Jose man has pleaded no contest to felony insurance fraud after he used his company to hide payroll for a security company run by a San Jose police officer.
Nam Le operated Defense Protection Group to launder millions of dollars in payroll for Atlas Private Security, now known as Genesis Private Security, and VP Security. Atlas is owned by Robert Foster, a former officer, who was sentenced last year to jail for insurance fraud, money laundering, tax evasion, and worker exploitation.
Le will be sentenced next year for the fraud charges and faces prison if he fails to pay more than $100,000 in restitution.
District Attorney Jeff Rosen said: "The criminal organization here was a security company run by a police officer and others. It is deeply disappointing that a group that is supposed to be dedicated to protecting people instead decided to scam them."
For operating an under-the-table subcontractor scheme, Le was paid $0.50 to $1 per hour of payroll he helped hide. After the Department of Labor questioned Le about the subcontractor scheme, he met with Foster, 50, who was a San Jose police officer at the time, and Richard McDiarmid, 62, Vice President of Operations for Atlas and former Emeryville police officer, at the Matrix Casino and asked to leave the conspiracy. Instead, the trio decided to expand the scam.
In all, Le helped launder approximately $18 million for Atlas Security. He is ordered to pay approximately $109,000 in restitution and penalties, including $60,000 back to the State of California Department of Insurance. If all restitution is paid by sentencing, he will serve six years of formal probation and one year in county jail. If he has not paid all restitution by sentencing, he will be sentenced to four years in state prison.
The six-month investigation was spearheaded by the Santa Clara County District Attorney’s Bureau of Investigation in collaboration with the California Department of Insurance, Employment Development Department, CA Department of Justice Division of Medi-Cal Fraud and Elder Abuse, and United States Department of Labor. This case paralleled the formation of the DA’s Workforce Exploitation Task Force.
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