The latest astonishing case of profitable insurance fraud from California. Yep, no jail time. Here’s the word;
Wesley Owens, 54, of Atlanta, Georgia, and Beau Wilson, 38, also of Atlanta, pleaded no contest to multiple felony counts of insurance fraud and conspiracy in Department 50 of the Los Angeles Superior Court before Judge Kerry White. The charges were filed after a California Department of Insurance investigation found the two defendants perpetrated a $54 million workers’ compensation insurance fraud scheme.
They both will be sentenced to 10 years formal probation, 60 days of community labor and are 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. Both also stipulated to an agreed additional $14.15 million owed in restitution during their 10 years of formal probation. If either defendant fails to fulfill the terms of their formal probation, or otherwise violates probation, they will be remanded to California State Prison for five years.
HOW THE SCAM WORKED
Owens owned and was the CEO of Bison Workforce Solutions, a Professional Employer Organization (PEO) based outside Atlanta, Georgia, that provided outsourced workers’ compensation insurance, human resources, payroll, tax and other services to other businesses. After receiving a referral from the State Compensation Insurance Fund, the Department launched an investigation which uncovered a massive workers’ compensation insurance fraud scheme perpetrated by Owens, Wilson, and other Bison employees.
The investigation found the company failed to pay approximately $29 million in premium as a result of its fraud and bilked its PEO customers out of approximately $25.5 million in fees they thought were paying for workers’ compensation insurance coverage.
The investigation found Owens would obtain workers’ compensation insurance for his company, Bison, and then use the documents provided to it by the insurance company to generate fraudulent Certificates of Insurance, which they would issue to PEO customers. The insurance carrier was told the policy was to cover a small, white-collar firm, not the PEO customers’ businesses which included agricultural workers, roofers, limo drivers, and a wide variety of other employees. The investigation also found Wilson, who was aware of the fraud, recruited customers for Bison and received commissions for each client that used the fraudulent services.
Bison became unable to obtain workers ‘compensation because of its persistent fraud so the company entered into a business relationship with another firm that already had a workers’ compensation insurance policy. Owens and his coconspirators began using that firm’s documents to continue generating fake insurance certificates. In order to conceal the fact that its policy was being misused to insure PEO customers, Bison began paying out claims itself. When the expense of this was too much for the company to sustain, it eventually stopped paying out claims and left workers uncovered by workers’ compensation insurance and with no recourse after being injured on the job.
The Department executed a search warrant in Georgia in conjunction with the Georgia Department of Insurance and conducted numerous interviews. On March 2, 2023, Owens and Wilson pleaded no contest. Probation and sentencing is initially set for September 13, 2023. The Los Angeles County District Attorney’s Office prosecuted the case.
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