Three Suspects Arraigned on Premium Fraud Charges

Three suspects were arraigned May 11 in Ventura County Superior Court in connection with a workers’ compensation premium fraud investigation conducted by the California Department of Insurance Fraud Division.

Tomer Rotholz, a former licensed contractor, was arraigned on a felony complaint charging him with four counts of premium fraud. Licensed contractor Yosef (Joseph) Khatib was arraigned on a felony complaint charging him with two counts of premium fraud. Catherine Larson was also arraigned and charged with four counts of premium fraud. If convicted, each of the defendants could be sentenced to a $50,000 fine or double the amount of the fraud, and up to 5 years in state prison. The case is being prosecuted by the Ventura County District Attorney’s Office.

The arraignments follow a joint investigation by the Department, the Division of Labor Standards Enforcement, Employment Development Department, Franchise Tax Board, Contractors State License Board, and National Insurance Crime Bureau.

Rotholz, of Woodland Hills, was arraigned on a felony complaint charging him with four counts of premium fraud. Khatib, of Sherman Oaks, was arraigned on a felony complaint charging him with two counts of premium fraud. Catherine Larson, of Canoga Park, was also arraigned and charged with four counts of premium fraud. If convicted, each of the defendants could be sentenced to a $50,000 fine or double the amount of the fraud, and up to 5 years in state prison. The case is being prosecuted by the Ventura County District Attorney’s Office.

According to investigators, Tapuz Enterprises, Inc. was a licensed contracting business owned and operated by Rotholz. Tapuz Enterprises was involved in landscape and maintenance contracting and was awarded several public works projects. he investigation revealed that Tapuz Enterprises and Rotholz allegedly underreported its payroll to State Compensation Insurance Fund and California Indemnity from 1998 to January 2002 by $834,006 and $853,174 respectively. Tapuz Enterprises and Rotholz were debarred from public works projects by the Department of Labor Standards Enforcement and had their contractor’s licenses suspended by the Contractors State License Board.

Rotholz then created Nativ Engineering, Inc. and allegedly conspired with Khatib, a former employee of Tapuz Enterprises, and continued business operations and the criminal activity under Nativ Engineering. Khatib obtained a contractor’s license and workers’ comp insurance with virtually the same employees as Tapuz. Tapuz Enterprises Inc., now operating as Nativ Engineering Inc., allegedly underreported its payroll to State Fund from May 2002 to November 2004 by $422,631. The total amount of alleged underreported payroll was $2,109,812.

Investigators allege Larson, an employee of Rotholz, was instrumental in the fraud perpetrated by Tapuz and ultimately, Nativ. She was the main point of contact for insurance carriers, state agencies and venders’ when it came to matters involving insurance, bonding and payroll. While working for Tapuz, she certified all the payroll reports that were submitted to State Fund and California Indemnity from 1998 to January 2002. Larson and Khatib certified Nativ’s payroll reports that were submitted to State Fund.

Topics California Fraud Numbers Contractors