April 4, 2025 | JacobiJournal.com — CA Delivery Company Owners: A Los Angeles couple received sentences after an investigation uncovered that they underreported $21 million in payroll for their delivery companies. Authorities say the scheme lasted several years and gave them an unfair advantage over competitors by cutting down on required workers’ compensation insurance premiums.
The fraud not only reduced their business costs but also put employees at risk by leaving them without proper coverage in the event of a workplace injury. According to investigators, this type of underreporting shifts the financial burden to insurers and the state, while undermining companies that comply with the law. The case against the delivery company owners highlights how payroll fraud can ripple through the entire workers’ compensation system, affecting honest employers, employees, and ultimately taxpayers.
Uninsured Companies and Fraudulent Claims
John Nemandoust (70) and Annette Assil (62) were sentenced for committing workers’ comp fraud. Nemandoust received 60 days in county jail, and Assil got 30 days. They also received 10 years of felony probation and must pay $2.2 million in restitution for unpaid premiums. CA Delivery Company Owners
The California Department of Insurance (CDI) began the investigation after reports indicated that two of the couple’s companies, Prompt Delivery and Affordable Messenger, had no insurance. Between 2013 and 2017, the couple only maintained workers’ comp insurance for A-1 Valley Services, their third company.
Underreported Payroll and Fraudulent Claims
Investigators found that when employees from the uninsured companies suffered work-related injuries, the couple submitted fraudulent claims under A-1 Valley Services’s policy. Over the four years, the couple filed claims for at least 20 employees from the uninsured companies.
A forensic audit showed that the companies reported only $1.4 million in payroll to their insurance carrier, though their actual payroll exceeded $25 million. This underreporting allowed the couple to evade $3 million in workers’ comp premiums.
Prosecution and Legal Consequences
The Los Angeles County District Attorney’s Office prosecuted the case, emphasizing the seriousness of workers’ compensation fraud and its impact on both employees and the broader business community. Prosecutors argued that the scheme carried out by the delivery company owners was not just about unpaid premiums, but about creating an uneven playing field that disadvantaged legitimate businesses that follow state labor laws.
As part of the sentencing, the court stressed that felony probation and restitution payments serve as a warning to other employers who might consider similar fraudulent practices. Legal experts note that California continues to prioritize these types of prosecutions, as workers’ comp fraud undermines the integrity of the insurance system and can leave injured employees without the benefits they are entitled to.
This case stands as an example of how state authorities are working in collaboration with the California Department of Insurance to hold business owners accountable, ensuring that fraud does not go unpunished.
For more detailed guidance on workers’ compensation insurance compliance and fraud prevention, visit the California Department of Insurance official resource: California Department of Insurance – Workers’ Compensation Fraud.
FAQs: CA Delivery Company Owners Workers’ Comp Fraud
Why were the CA Delivery company owners fined $2.2 million?
They were ordered to pay restitution after underreporting $21 million in payroll, which allowed them to avoid nearly $3 million in workers’ comp insurance premiums.
How did investigators uncover the fraud by the CA delivery company owners?
A forensic audit and insurance review revealed a significant payroll gap, along with fraudulent claims filed under their insured company, A-1 Valley Services.
What companies were involved in the case?
The couple operated Prompt Delivery, Affordable Messenger, and A-1 Valley Services. Only A-1 was insured, yet claims from the other two companies were falsely filed under it.
What legal consequences did the delivery company owners face?
They received county jail sentences, felony probation, and were ordered to repay $2.2 million in restitution for their fraudulent scheme.
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