A Family Owned Business Gets Convicted of Workers Comp Fraud

cashCosta Bella Builders is a family owned and operated company out of Santa Cruz, CA.  Owner Jeffrey Thranow has been convicted of workers compensation and sentenced to one year in jail for failing to report employees injuries to his insurance company or to the Employee Development Department (EED).  Vittorio Castelli, the son-in-law of Thranow was also charged with felony insurance fraud and sentenced to six months in jail.  Thranow’s daughter Kathleen Castelli received one year of probation for her misdemeanor conviction on insurance fraud.

An investigation was opened into Costa Bella Builders after an employee reported an injury.  Thranow would pay employees who got hurt in cash to avoid having to pay for workers comp insurance.  His daughter and son-in-law would also convince these employees to accept cash payments in exchange for not reporting the injury.  He would also give the injured worker a State Disability form and instruct the worker to claim the injury occurred while they were at home.

Costa Bella Builders must pay over $47,000 in restitution, almost $30,000 in back taxes to the EDD, and another $37,000 related to injured workers claims.

“Fraud is a multi-billion dollar enterprise, which artificially inflates costs to insurers, consumers, and California’s taxpayers,” said Commissioner Dave Jones. “Thranow cheated both his workers’ compensation insurer and the State of California out of nearly $100,000, and by doing so passed the cost of his fraud onto consumers across the state. Through a collaborative effort between my department and the Santa Cruz District Attorney’s Office, we have brought another non-compliant contractor to justice.

Source: California Department of Justice

What's your take? Continue the discussion with others over at the WCInsights LinkedIn Group.
Print Friendly, PDF & Email