Arrests Made in Worker Misclassification Scam
Laborers were classified as florists to lower insurance premiums
Laborers, foremen, and heavy-equipment operators were misclassified as florists, office workers, or sales representatives in order to skimp on insurance premiums, according to indictments of two Bellmore men and their companies, announced Tuesday by the Manhattan District Attorney’s Office.
The alleged fraud meant more than $1 million avoided in insurance premiums by misclassifying workers laboring on New York City sidewalk and road repair contracts as being at lower risk for injury, according to the office.
The fraud — allegedly committed by Nicholas Dragonetti, 48, and Vito Dragonetti, 52, and Dragonetti Brothers Landscaping, Nursery, & Florist, and D.B. Demolition Inc. — came to the attention of the government from a tipster, according to a news release issued by the office.
The release says that between 2017 and 2019, 217 "laborers, foremen, and heavy-equipment operators" were misclassified by Dragonetti Brothers Landscaping, Nursery, & Florist, which since 1998 has gotten more than 100 city contracts, as "florists, office workers, or sales representatives." Misrepresentations were done on applications to the New York State Insurance Fund for Workers’ compensation insurance, allegedly to avoid having to pay higher premiums.
Meanwhile, contracts were bid on and won for "excavation, sidewalk reconstruction, and pedestrian ramp replacement for residential blocks throughout the City totaling millions of dollars."
According to the release: "During the same time period, D.B. Demo also misclassified several workers …. claiming the individuals were office workers while simultaneously listing them as commercial drivers in paperwork filed with" another agency, thus evading over $81,000 in premiums.
The Dragonettis couldn’t be reached for comment Tuesday, nor could any attorneys be identified on their behalf. The state court online database didn't yet list arraignment information. The company website says Dragonetti Brothers Landscaping, where the phone appeared to be out of order, is family-owned and has been in business for over 40 years. A message left with D.B. Demolition Inc.’s answering service wasn’t returned.
he release says: "When companies evade insurance premiums, they put their workers at risk of not receiving adequate insurance to cover on-the-job injuries. Inadequate coverage is a particularly concerning prospect in the construction industry, where workers put their bodies on the line.
"As alleged in this case, the defendants devalued their workers’ livelihoods by insuring them for lower-risk work while simultaneously sending them to carry out demolition projects and operate heavy machinery."
Charges against Nicholas Dragonetti and Vito Dragonetti, and Dragonetti Brothers Landscaping, Nursery, & Florist, and D.B. Demolition Inc. are felonies. They include insurance fraud, offering a false instrument for filing, and penalties for fraudulent practices under the state Workers’ compensation law.