Monterey, CA – Monterey County District Attorney Dean D. Flippo announced that Juan D. Rosas, age 36 of Pacific Grove, was recently sentenced by the Honorable Julie R. Culver for three felony charges including failing to accurately report employee wages to obtain a lower workers’ compensation insurance premium; fraudulent use of a contractor’s license; and willfully failing to file payroll tax returns with intent to evade tax. The defendant was doing business as Juan the Builder and Associates, Inc. The defendant reported no employee wages or underreported wages to the State Compensation Insurance Fund [SCIF]; underreported or did not report any wages or payroll taxes to the Employment Development Department [EDD]; and worked as a contractor when his Contractor State License Board [CSLB] license was suspended. The defendant’s license was suspended in September, 2010 by CSLB for not having a bond and not having workers’ compensation insurance. The Secretary of State had also placed a suspension on his CSLB license.
The defense attorney requested a specially set sentencing hearing to argue that the felonies should be reduced to misdemeanors. During the four hour hearing, Chief Inspector John Kuehl of the Monterey and Pacific Grove Building Department testified that homeowners need to be able to rely on representations as truthful when contractors state they are licensed and insured. He further testified that the integrity and honesty of contractors is of upmost importance to the homeowner
who is allowing a contractor into their home to complete work often for a long period of time. Further, there is a potential liability issue when a contractor does not have a bond in place or has employees working for them without workers’ compensation insurance.
The People argued against the felonies being reduced to misdemeanors. The court ruled the convictions would remain felonies and placed the defendant on probation for six years and four months, the maximum duration by law. The Court ordered the defendant to serve 40 days in county jail, pay over $30,000 in fines, be subject to a search by any probation or peace officer and be subject to other terms and conditions of probation to ensure the defendant is properly conducting
business. The court ordered victim restitution in the amount of $67,406.82 to be paid to the SCIF with interest to accrue at 10% per annum and victim restitution in the amount of $155,250.03 to be paid to the EDD for the failure to file and pay payroll tax returns.
The case was investigated by CSLB Investigator David Leary, District Attorney Investigator Martin Sanchez, and EDD Investigator Devon Brown. The SCIF premium audit was prepared by CDI Candace Altamirano.
Employers are required to register their businesses, report and pay taxes to EDD for all employees. Contractors have license requirements. Additionally, business owners and the public need to be aware that California law requires all employers to secure workers’ compensation insurance for their employees so that there is adequate medical coverage and other benefits for employees for any work related injuries that may occur.
Source: Monterey County DA’s Office