CDI: Trucking Company Owners Cheated Workers’ Comp Carrier out of Millions
A pair of California trucking company owners were arrested for cheating their workers’ compensation insurer out of millions of dollars.
Alvin Shin Chen, 54, and Fiona Xilin Chen, 46, both of La Canada Flintridge, Calif., were arrested in early May at their home by detectives from the California Department of Insurance and charged with multiple felony counts, including workers’ comp insurance premium fraud for allegedly cheating their carrier.
The Chens, owners of Metro Worldwide Inc. and Pacific Coast Distribution, operate a trucking company in Long Beach and are accused of attempting to reduce their workers’ comp premiums by providing fraudulent information to their insurer regarding the number of their employees and what work those employees performed.
CDI detectives reportedly uncovered evidence indicating the Chens paid cash to employee truck drivers to avoid reporting them to the insurer and reduce their payroll tax obligation. Audits of the Chens’ records show they underreported their payroll by more than $4.7 million. As a result, the Chens allegedly cheated their insurer out of more than $1.6 million in workers’ comp premium.
“Employers that cheat the system through premium fraud and tax evasion create an illegal marketplace advantage that costs California’s economy billions,” Insurance Commissioner Dave Jones said in a statement.
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