The United States Attorney’s Office, Middle District of Florida, January 21, 2022
Tampa, Florida – United States Attorney Roger B. Handberg announces that George Garcia (24, Tampa) has pleaded guilty to one count of conspiracy to commit wire fraud. Garcia faces a maximum penalty of 20 years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, Garcia owned and managed a construction company that he had registered with the State of Florida in October 2018. This company purported to supply construction services and labor for construction site contractors. In order to comply with Florida law, Garcia’s company was required to secure and maintain adequate worker’s compensation insurance coverage.
Providers of worker’s compensation insurance base the premiums they charge and the amount of coverage they provide on the number of employees a company has and the total annual payroll of those employees. Garcia’s company had agreements with contractors and subcontractors to use workers purported to be Garcia’s employees at construction sites. These workers were often undocumented aliens who were working for and under the daily supervision and direction of the contractors. Garcia or others regularly received “payroll checks” from contractors that were cashed at various financial institutions to pay Garcia’s purported “employees” and other related expenses.
During the time period charged in the criminal information, Garcia falsely and fraudulently represented in insurance applications that his company had a very limited payroll and a very limited number of employees who worked on construction jobsites. Garcia also falsely and fraudulently sent wire communications to numerous contractors representing that his company’s employees had full worker’s compensation coverage. In reality, Garcia’s company received and cashed more than $19 million in checks from various construction contractors for these purported “employees”. This payroll figure far exceeded the very limited payroll figures that Garcia had reported to his worker’s compensation insurance company. As a result, the employees of Garcia’s company, the employees of other entities, performed work on jobsites without adequate insurance coverage. In addition, the insurers lost premiums that they would have charged had they been aware of the true number of workers their policies were thus being manipulated to cover.
As a result of these misrepresentations, Garcia’s company also disclaimed responsibility for ensuring that jobsite workers were legally authorized to work in the United States, and that the required state and federal payroll taxes were being paid for these workers. The contractors who actually paid these workers’ wages and used their services were thus also able to avoid responsibility for those taxes.
This case was investigated by Homeland Security Investigations and the Florida Department of Financial Services. It is being prosecuted by Assistant United States Attorney Jay L. Hoffer.
News article: https://www.justice.gov/usao-mdfl/pr/tampa-man-pleads-guilty-conspiracy-commit-wire-fraud