An on-site audit by their insurer on May 16 exposed conflicts with information provided by the owners.
The owners of a Palm Coast drywall business were charged with insurance fraud and organized fraud after allegedly failing to report their true payroll exposure, according to a charging affidavit by the Florida Department of Financial Services’ Bureau of Insurance Fraud.
The owners of Palm Coast’s Evolution Drywall Inc. — President Christian Arnoldo Moran, Vice President Blanca Margarit Rivera Tejada and Secretary Erik Riquelmy Tejada — purchased minimal worker’s compensation insurance coverage in the amount of $140,000 through Bridgefield Employers Insurance Company.
They claimed to have four employees and indicated that they did not use subcontractors or independent contractors, that there was no labor interchange with any other subsidiary, and that no work was sublet without certificates of insurance.
The insurer conducted an on-site audit on May 16 that exposed conflicts with the information provided by the owners.
An investigation revealed that there are 13 employees at the business, and a sub-contractor’s worksheet listed 30 subcontractors that had been used, two of which were uninsured, according to the affidavit. The business also reported payouts and losses that reflected an annual income of $57,115.98. The audit showed an actual income of $2,956,784.72.
The investigation also revealed that Dream Finders Homes LLC paid Evolution Drywall $696,963.78 for labor services only for drywall installation, according to the affidavit. In addition, Evolution Drywall paid $247,325,30 to uninsured subcontractor Millennium Drywall Enterprises LLC and $36,801 to uninsured subcontractor Seven Rays Drywall and Construction Services Inc. According to Evolution Drywall’s own employee list, the owner of Seven Rays Drywall, Delmy Barahona, is an employee who was additionally listed in the payroll expenses as being paid $27,750. Evolution Drywall's subcontractor list also shows paying Rivera $15,600 as a subcontractor.
The organized fraud scheme resulted in the theft of premium funds that exceeded the aggregate value of $50,000 or more, a first degree felony.
Moran, 42, was booked at the Flagler County Inmate Facility on June 13 with a bond set at $15,000.