April 7, 2025 | JacobiJournal.com — Los Angeles delivery owners to Repay for workers’ compensation fraud: On April 3, 2025, the California Department of Insurance (CDI) announced the sentencing of John Nemandoust, 70, and Annette Assil, 62, for a long-running workers’ compensation fraud scheme. The Los Angeles couple underreported more than $21 million in employee payroll across their three delivery companies.
Sentencing and Restitution
A judge sentenced Nemandoust to 60 days in county jail and Assil to 30 days. In addition, both received 10 years of felony probation and must repay $2,254,748 in restitution for unpaid workers’ compensation insurance premiums. The restitution order is intended not only to recover the financial losses caused by their scheme but also to reinforce the seriousness of workers’ compensation fraud in California.
The probation terms mean the couple will remain under close supervision for a decade, with any violations potentially resulting in harsher penalties. Restitution payments are also structured to ensure accountability over the long term, signaling that financial misconduct in the insurance system carries lasting consequences for those involved.
Uninsured Companies and Fake Claims
CDI began investigating after learning that two of the couple’s businesses—Prompt Delivery and Affordable Messenger—operated without workers’ compensation insurance. The third company, A-1 Valley Services, held an active policy.
Between 2013 and 2017, the couple only insured Valley Services. When employees from the uninsured companies suffered work-related injuries, Nemandoust and Assil submitted their claims under Valley Services’ policy. Investigators confirmed that at least 20 claims were improperly filed during this time. Los Angeles Delivery Owners
Massive Payroll Underreporting
A forensic audit revealed that the companies had a combined gross payroll of over $25 million, but only reported about $1.4 million to their insurer. As a result, they dodged nearly $3 million in workers’ comp premiums. The scale of the underreporting highlighted how even large operations can conceal payroll numbers to manipulate premium costs.
Auditors determined that the gap between the actual payroll and reported figures was so significant that it could not have been the result of simple clerical errors. Instead, the evidence pointed to a deliberate effort to avoid paying into the workers’ compensation system. This manipulation not only harmed the insurance carrier but also placed honest businesses at a disadvantage by distorting the true cost of coverage in the industry.
Prosecution
The Los Angeles County District Attorney’s Office prosecuted the case, emphasizing the importance of holding business owners accountable for defrauding state insurance systems.
For readers seeking more information on how California combats workers’ compensation fraud, visit the California Statewide Law Enforcement Association.
FAQs: Los Angeles Delivery Owners Fraud Case
Why were the Los Angeles Delivery Owners sentenced?
The Los Angeles delivery owners were sentenced for underreporting more than $21 million in payroll across their three companies to avoid paying workers’ compensation insurance premiums.
How much must the delivery owners repay?
The court ordered the Los Angeles delivery owners to pay $2,254,748 in restitution to cover unpaid workers’ comp insurance premiums.
What fraudulent actions did the delivery owners commit?
They operated two companies without workers’ comp insurance and filed at least 20 fake claims under their insured company’s policy, while misrepresenting payroll.
What does this case mean for other employers?
This case highlights that employers who commit payroll or insurance fraud will face prosecution, restitution, and potential jail time under California law.
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