Duo sentenced for $54m workers’ comp insurance fraud scheme
According to the investigation conducted by the California Department of Insurance, Owens obtained workers’ compensation insurance for Bison and then used the documents provided by the insurance company to generate fraudulent certificates of insurance, which were issued to PEO customers. The insurance carrier was informed the policy was to cover a small, white-collar firm, not the PEO customers’ businesses that included agricultural workers, roofers, limo drivers, and a wide variety of other employees.
Beau Wilson, 38, was found to have been aware of this scheme, recruiting customers for Bison and receiving commissions for each client.
Workers left with no insurance coverage
Bison was unable to obtain workers’ compensation insurance due to the continued fraud, so the company entered into a business relationship with another firm that already had a workers’ compensation insurance policy, according to the investigation. Owens and his co-conspirators began using that firm’s documents to continue generating fake insurance certificates.
The California Department of Insurance said Bison began paying out claims itself to conceal the fact that its policy was being misused to insure PEO customers.
However, when the expense proved to be too much for the company to sustain, it eventually stopped paying out claims and left workers with no insurance coverage that would provide them with recourse after being injured on the job.
The department ultimately found that Bison failed to pay approximately $29 million in premium and duped its PEO customers out of approximately $25.5 million in fees they thought were paying for workers’ comp coverage.
Both Owens and Wilson will be sentenced to 10 years formal probation and 60 days of community labor, the department said. They were also ordered to pay $350,000 cash prior to their final sentencing in restitution.
Wilson additionally agreed to sell five pieces of real property and remit the proceeds of the sale towards further restitution.
The two also stipulated to an agreed additional $14.15 million owed in restitution during their probation period.
The case was prosecuted by Los Angeles County District Attorney’s Office, with probation and sentencing initially set for September 13, 2023.
