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News: 2011 Press Release

For Release: December 29, 2011
Media Calls Only: 916-492-3566
Insurance Commissioner Dave Jones Announces Joint Effort In Battle To Fight California's Underground Economy
Department of Insurance part of Labor Enforcement Task Force

Insurance Commissioner Dave Jones today announced that the California Department of Insurance (CDI) is joining with the Department of Industrial Relations (DIR) and other allied agencies to fight labor law and insurance related violations that exist in an underground economy.

The newly created Labor Enforcement Task Force (LETF), which will be headed by the DIR, will launch on January 1, 2012 and will be a collaborative effort along with the Attorney General, Employment Development Department, Contractor's State Licensing Board, Board of Equalization, the Bureau of Automotive Repair and local district attorneys.

"I am pleased to join this collaborative effort to protect California workers," said Insurance Commissioner Dave Jones. "I am committed to fair competition for honest business owners."

The Department's focus in this collaboration will be on those unscrupulous employers who under report payroll or misclassify employees in order to obtain a lower rate for workers' compensation coverage, thus committing premium fraud. This gives business owners, operating illegally in the underground economy, an unfair advantage over honest and law abiding employers when competing for business.

Since Commissioner Jones took office on January 1, the Department has pursued businesses operating illegally in the underground economy. Investigations have been conducted which have led to the arrest of 47 business owners for premium fraud involving approximately $41 million in unpaid premiums.

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The California Department of Insurance, established in 1868, is the largest consumer protection agency in California, regulating the $123 billion insurance marketplace. In 2012 the California Department of Insurance received more than 160,000 calls from consumers and helped recover over $64 million in claims and premiums. Please visit the Department of Insurance web site at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.HELP. Out-of-state callers, please dial 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.

If you are a member of the public wishing information, please visit our Consumer Services.

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