CA: San Jose Police Officer Charged with Worker Exploitation, Multi-Million Dollar Fraud Scheme
San Jose, CA (WorkersCompensation.com) - The Santa Clara County District Attorney's Office has charged a San Jose police officer with using his private security company to commit insurance fraud, tax evasion, wage theft, and about $18 million in money laundering.
Robert Foster, 47, the Morgan Hill owner of Atlas Private Security, self-surrendered and will be arraigned on November 30th, at the Hall of Justice in San Jose on felony charges. Foster's wife and eight other company employees are being charged with four counts of felony conspiracy to commit insurance fraud, unemployment insurance fraud, money laundering, and wage theft, and 39 additional felonies, including extortion and a white-collar crime enhancement. They face prison time, if convicted.
The officer and his co-defendants allegedly reduced insurance premiums and taxes by reporting false and inaccurate payroll, underreporting headcount, paying employees off-the-books, and underreporting employee injuries. In one case, an employee was allegedly threatened with deportation if she continued to speak with attorneys about her rights under worker's compensation laws after suffering a workplace injury.
The arrest comes just days after District Attorney Jeff Rosen announced a series of social justice reforms that included creating a Workers Exploitation Task Force that will investigate cases such as this one.
“This Office will root out and prosecute anyone – whether they wear a badge or not - taking criminal advantage of workers,” District Attorney Rosen said. “Our new task force will protect and heal the victims of labor trafficking, wage theft and illegal exploitation and raise awareness about how these insidious crimes are attacks on our communities of color.”
The six-month investigation was spearheaded by the Santa Clara County District Attorney's Office Bureau of Investigation in close collaboration with the California Department of Insurance, Employment Development Department, California Department of Justice Bureau of Medical Fraud and Elder Abuse and United States Department of Labor.
The probe showed that Foster allegedly hid approximately $8.09 million in payroll over three years, avoided approximately $578,716.56 in tax liability and $560,293.15 in insurance premiums. To carry on their fraud scheme, the Atlas officials allegedly laundered approximately $18.20 million. The co-conspirators used and traded on Foster's position as an active-duty San Jose Police Officer and self-described expert in lie detection to further their business interests. Yet, Foster allegedly failed to disclose to SJPD that he owned and operated Atlas or that such ownership could result in ethical conflicts.
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