Merced agriculture company owner and daughter sentenced in $2.5 million insurance fraud scheme

Merced agriculture company owner and daughter sentenced in $2.5 million insurance fraud scheme

Originally published as CDI SIU E-blast –

MERCED, Calif. —Felipe Saurez Barocio, 63, of Atwater, owner of Agriculture Services, Inc., and his daughter, Angelita Barocio-Negrete, 34, of Merced, were sentenced to 10 years after pleading no contest to six felony counts of insurance fraud each. Pursuant to Penal Code 1170(h), they will both serve six years in custody and four years on mandatory supervision. They have also been ordered to pay $2,582,142 in restitution – the amount of workers’ compensation insurance premium they avoided paying over five years.

Barocio and his daughter underreported employee payroll by $11 million in order to fraudulently reduce the business’s premium for workers’ compensation insurance. The fraud potentially left employed farm workers without insurance coverage and at financial risk.

On October 14, 2019, State Compensation Insurance Fund (SCIF) filed a suspected fraudulent claim with the California Department of Insurance alleging potential insurance fraud. SCIF reported that Barocio, as owner of a farm labor contracting business, underreported employee payroll in order to reduce the proper rate of insurance premium owed to SCIF.

An investigation by the California Department of Insurance revealed that between 2015 and 2019, Barocio and his daughter, who worked as the office manager, provided SCIF with fabricated quarterly employee payroll reports. The Department discovered $11 million in missing payroll when they compared the quarterly reports submitted to SCIF to the quarterly reports submitted to the Employment Development Department. This underreporting of employee payroll resulted in a total loss of $2,582,142 in insurance premium.

Barocio and his daughter, Barocio-Negrete, were sentenced on January 12, 2021, in the Merced Courthouse and ordered to pay restitution on February 22, 2021. The Merced County District Attorney’s Office prosecuted this case.

 

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Merced agriculture company owner and daughter sentenced in $2.5 million insurance fraud scheme was last modified: March 8th, 2021 by admin
Categories: Merced