New Jersey authorities announced that a married couple who own several temporary staffing companies with offices in northern and central New Jersey were arrested on first-degree charges.
According to a Feb. 4 announcement from the New Jersey Office of the Attorney General, the couple and a co-defendant allegedly grossly underreported the number of employees their companies outsourced, and hid more than $30 million of income, which resulted in the underpayment of their workers’ compensation insurance premiums and income tax from 2009 through 2013.
Milltown, New Jersey, residents Andres Minaya and Jenny Minaya, owners of temporary staffing companies doing business as Olympus Management Services, Atlantis Personnel and other names, were arrested on Feb. 3. Search warrants were executed at five Olympus locations and at the office of AM Professional Services, a tax preparation company allegedly owned by the Minayas, according to authorities.
The Minayas were each charged with first-degree financial facilitation of criminal activity. Andres Minaya was also charged with second-degree insurance fraud and filing a false return. Authorities also arrested the Minayas’ nephew, Randy Colon, who is purported to have purchased Olympus Management from Andres Minaya, allegedly in furtherance of the workers’ compensation insurance fraud scheme. Colon was charged with with second-degree insurance fraud.
“The defendants had a legal responsibility to provide adequate and lawful workers’ compensation coverage for employees,” said New Jersey Acting Attorney General John J. Hoffman. “Not only did they allegedly steal millions from the United States and New Jersey taxpayers, they failed to pay for the appropriate protections for their employees.”
Authorities said the investigation began when the case was referred to the New Jersey Office of the Insurance Fraud Prosecutor (OIFP) by Liberty Mutual Insurance Company, which conducted an audit of Andres’ staffing company (then called Atlantis Personnel), which carried workers’ compensation coverage through Liberty from May 2011 through February 2013.
The audit allegedly found misrepresentations by Andres concerning the number of employees Atlantis outsourced and total employee salaries. Andres supplied federal tax returns and partial bank statements which were allegedly inconsistent with the amount of business he claimed he did in New Jersey.
After the audit, Liberty adjusted the premium owed by Minaya by about $1 million. Minaya allegedly did not pay and instead canceled the policy and created a new company under the Olympus name. The OIFP and the New Jersey Department of the Treasury, Office of Criminal Investigation opened a joint investigation, ultimately resulting in the searches and arrests.
OIFP estimates that Olympus is currently employing as many as 800 employees at several hundred businesses in New Jersey. Temp agencies are responsible for providing benefits, making deductions, and carrying the required insurance benefits, such as workers’ compensation insurance.
It is alleged that from 2009 to 2013, Minaya and his companies received about $50 million from a factoring company in exchange for their accounts receivable. In that corresponding period, Minaya and his associated companies reported about $15 million total personal and corporate income, according to authorities. (Factoring is a financial transaction in which a business sells accounts receivable to a third party at a discount.)
First-degree crimes carry state prison sentences of up to 20 years in prison and a criminal fine of up to $200,000, while second-degree crimes carry prison sentences of up to 10 years in prison and a $150,000 fine. The charges announced are merely accusations and the defendants are presumed innocent until proven guilty.
Source: New Jersey Office of the Attorney General
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