Alleged $1.2M in Workers’ Comp Fraud Leads to Arrest in Louisiana

The Louisiana Workforce Commission (LWC) and the state’s attorney general reported the arrest of a Louisiana couple for alleged workers’ compensation premium fraud.

Mauro and Keren Aguirre, owners of Escapade Acoustic Drywall in Lafayette, are charged with felony theft and workers’ comp fraud for an estimated $1.2 million in unpaid insurance premiums.

Agents with the Louisiana Insurance Fraud Task Force arrested the pair after a search of their Lafayette home uncovered evidence of concealed payrolls and misrepresentation of workers to avoid the full payment due of workers’ compensation insurance premiums.

Escapade Acoustic Drywall provides labor for the hanging of drywall in commercial applications. The company has done commercial drywall work throughout Louisiana.

The task force that made the arrest is a joint effort of LWC, Louisiana State Police, Louisiana Department of Insurance and the Louisiana Attorney General’s Office.

According to arrest records, the task force received a tip from a representative of the Louisiana Carpenter’s Regional Council (carpenter’s union) based on financial reports and other records found in bags of trash left around the perimeter of the Aguirres’ home.

The resulting investigation revealed the company may have under-reported its employees and income for years 2007 and 2008. Records show the company reported around 35 employees with a payroll of about $145,347 when it should have reported more than 300 employees and a payroll of more than $4.2 million.

The Louisiana Workforce Commission has been working throughout the year as part of the task force investigating suspected employer and employee fraud. Through the second quarter of 2009, nearly 1,600 investigations had been completed by the LWC Office of Workers’ Compensation Fraud and Compliance Units, with 13 referred to the AG’s office for possible prosecution. More than seven arrests have been made so far this year.

All employers in Louisiana are required to provide workers’ compensation insurance for their employees. Failure to do so could result in a fine of up to $250 per employee per incident. Continued non-compliance can result in larger fines, an injunction from doing business in the state or possible jail time, the LWC said.

Sources: Louisiana Workers’ Compensation Commission, Louisiana Attorney General’s Office