Co-owners of California trucking company charged for workers' comp fraud

By Land Line staff | Tuesday, June 07, 2016

Two owners of a Long Beach-based trucking company have been arrested for workers’ compensation charges, according to a Los Angeles County District Attorney’s Office press release. The couple allegedly underreported payroll by $4.7 million over a four-year period.

Courtesy of California Department of Insurance

Alvin and Fiona Chen

Alvin Shih Chen and Fiona Chen, co-owners of Metro Worldwide, Inc., have been charged with 18 counts of workers’ compensation fraud and five counts of failing to pay taxes. Between 2009 and 2013, Alvin and Fiona Chen allegedly reported a payroll of nearly $3 million to the State Compensation Insurance Fund. The actual amount was $7.6 million.

Alvin and Fiona Chen allegedly paid truck drivers in cash to avoid reporting them to the insurer and reduce the payroll obligation, according to California Department of Insurance press release.

According to the District Attorney’s press release, companies pay significantly less premiums when they underreport payroll. An estimated $2.1 million was lost.

Bail was recommended to be set at $950,000. A sentence of 36 years in state prison is possible if the defendants are found guilty.

“Employers that cheat the system through premium fraud and tax evasion create an illegal marketplace advantage that costs California's economy billions,” said Insurance Commissioner Dave Jones in a press release. “We are putting a concerted effort into curbing the underground economy and leveling the playing field for California's honest business owners.”

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