A Florida construction company owner was sentenced to 48 months in federal prison for a $1 million workers’ compensation, tax and wire-fraud scheme.
Ricky Gonzales, the owner and manager of the construction company, was also ordered on Nov. 10 to forfeit $500,731, the proceeds of the wire-fraud conspiracy.
Gonzales pleaded guilty to the charges on Aug. 9, 2022.
Scheme involved shell company, undocumented immigrants
According to the Department of Justice, Gonzales owned and managed a company that claimed to supply construction services and labor for construction contractors and subcontractors. Florida state law required Gonzales to have adequate workers’ compensation insurance coverage.
The company had agreements with contractors and subcontractors to use workers at construction sites who appeared to be Gonzales’ employees but were often undocumented immigrants who were actually employees of the contractors.
Payroll checks were received by Gonzales from the contractors and were cashed at various banks to pay for his “employees” and related expenses.
Falsely represented payroll for lower premiums
In order to lower his workers’ compensation insurance premiums, Gonzales falsely represented his payroll as being very limited with only a few employees who worked on construction sites. He also sent fraudulent wire communications to contractors, claiming his employees had full workers’ compensation coverage.
However, the truth of the matter was that Gonzales and his company received and cashed more than $7.15 million in checks from contractors for his “employees.” That payroll figure “far exceeded the very limited payroll figures that Gonzales had reported to his workers’ compensation insurance company.”
Employees worked without adequate comp coverage
This resulted in:
- employees, who were really the employees of other businesses, working on jobsites without adequate workers’ compensation insurance coverage
- the insurance company to lose premiums it would have charged if it had been aware of the correct payroll information, and
- Gonzales and the contractors who used his services avoiding responsibility for federal and state taxes related to the undocumented workers, leading to a loss of more than $1 million for the U.S. Internal Revenue Service.
The investigation was conducted by U.S. Homeland Security Investigations, the State of Florida Department of Financial Services and the Internal Revenue Service-Criminal Investigation.
