NYC district attorney charges contractor in $9.5M wage fraud scheme
- Manhattan District Attorney Cyrus R. Vance Jr. on Wednesday announced indictments against a New York City construction company, its top executives and others for their parts in a 2014-to-2017 wage-theft scheme that allegedly defrauded more than 500 workers out of $1.7 million in pay and the New York State Insurance Fund (NYSIF) out of $7.8 million in workers' compensation premiums. During that period, the DA's office said Parkside Construction and its related companies performed more than $100 million of concrete and masonry work on at least seven high-rise projects.
- The DA claims that Parkside, their principals and Affinity Human Resources, a payroll processing company, intentionally adjusted time-keeping records to reflect that employees had worked fewer hours than they actually had. Vance also said that some workers were paid through expense reimbursement checks so that Parkside could avoid having to pay wage-related tax and insurance contributions. In addition, Parkside allegedly underreported its payroll to the NYSIF by $42 million to avoid having to pay workers' comp premiums on those wages.
- In addition, the DA's office said it will file a civil suit to recover the stolen wages and insurance premiums so that restitution can be made to workers and the NYSIF. In the first six months of its new joint wage-theft initiative with city and state officials, the DA's Construction Fraud Task Force unit has returned to workers almost $650,000 in stolen pay.
In December 2017, Vance announced the wage-theft program, along with news that his office had charged area construction companies with stealing more than $2.5 million from more than 400 workers. The amount each company was accused of underpaying ranged from $13,000 to $700,000, representing bounced checks, insufficient wage rates, refusal to pay overtime and general nonpayment.
Immigrant workers, Vance's office said, are three times more likely to fall prey to these schemes. The building boom in New York City has created more opportunities for some companies to take advantage of their employees in this way.
Of course, wage theft is not limited to just New York City. In February, the Orange County (California) DA's office charged a group of contractors with underpaying workers and the resulting payroll taxes, all of which totaled approximately $200,000. The alleged fraudulent activity happened on a $10 million county amphitheater project where prevailing wages were in effect, and authorities said the contractor and its owners, who denied the charges, intentionally altered records to conceal the underpayment.
- Manhattan District Attorney's Office DA Vance, Partners Announce Criminal Charges in Multimillion Dollar Wage Theft and Insurance Fraud Case
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