Payroll Was Millions More than Florida Contractor Reported, DFS Says

A south Florida contractor faces significant jail time after he was arrested for vastly underreporting his payroll to his workers’ compensation insurer.

Hector Gutierrez-Morales, owner of HG & AKE Construction Corp., in Miami, was charged with workers’ compensation premium fraud, Florida CFO Jimmy Patronis announced. The contractor allegedly reported to Travelers Insurance that his annual payroll was $161,000.

In reality, it was more like $3 million, authorities said. The understatement fraudulently reduced the company’s annual premium from $796,762 to $28,000, according to the news release.

“The investigation revealed that Gutierrez-Morales, on behalf of HG & AKE Construction Corp., failed to notify his insurance company of significant annual payroll changes,” the bulletin said. “Detectives were able to determine that during these policy periods, Gutierrez-Morales collected more than $8.8 million over three years for labor costs paid from contractors to his company.”

The man was booked into the Miami-Dade County Jail on July 20. He appears to have posted bail money and was not listed as an inmate in the jail as of this week.