A certified public accountant (CPA) in New York was charged in a $10 million workers’ compensation fraud scheme involving multiple construction contractors.
Steven Lyon, a CPA for four different contractors, was charged May 4 with three counts of first degree insurance fraud, five counts of second degree insurance fraud, eight counts of first degree falsifying business records and nine counts of second degree forgery.
Lyon is alleged to have defrauded the New York State Insurance Fund (NYSIF) of more than $10 million in workers’ compensation insurance premium payments by filing doctored payroll-related documents on behalf of the contractors, according to the New York District Attorney’s Office.
The owners of two of the construction contracting companies are facing similar charges for participating in the scheme. Mario Rojas Jr., the owner of OneTeam Restoration Inc., and Sadaf Bhatti, the owner of Anaar Construction & Contracting Corp., were charged with Lyon in separate cases.
Case against accountant in OneTeam scheme remains open
In January, Lyon was arraigned in the New York State Supreme Court for his part in the OneTeam Restoration case. Lyon and Rojas each pleaded guilty to one count of first degree falsifying business records and were sentenced to three-year conditional discharges.
The case against Lyon for this scheme remains open and pending.
Anaar Construction case involved ‘Premium Audits’
In the Anaar Construction case, Bhatti allegedly used Lyon to complete “Premium Audits” even though Bhatti already had a private tax accountant. Lyon served as the company’s representative during NYSIF mandatory annual audits.
From March 10, 2018, to March 10, 2020, Lyon filed payroll-related documents for Anaar Construction that “drastically reduced the size of Anaar’s workforce and payroll.” Over the course of the scheme, Anaar Construction underreported its payroll by more than $4.5 million and underpaid NYSIF by more than $1.4 million.
Lyon charged in 2 more cases involving loss of $9.4M in premiums
In two other cases involving DNA Contracting LLC and Spring Safe & Sound Inc., Lyon is solely charged for running a similar scheme related to audits and filings for those two companies.
Lyon was charged for misrepresenting the total workforce and payroll for both companies from January 1, 2019, to March 1, 2022, during quarterly filings resulting in a $9.4 million loss in premiums for NYSIF.