Insurance Commissioner Dave Jones Announces Arrest of Bay Area Business Owners, Employee for Workers' Comp Insurance Premium Fraud
News: 2012 Press Release
Insurance Commissioner Dave Jones today announced the arrests of Sied "Mike Zarrin" Zarrinsaray, 52, his wife Ronak Barazandeh, 43, the owners of United RMR Enterprises, Inc. of San Jose, and their employee, Chad Oberquell, 40, for workers' compensation insurance fraud. If convicted all three could receive a sentence of up to five years in state prison and $50,000 in fines and restitution.
According to California Department of Insurance (CDI) Fraud Division Detectives, on August 26, 2010, Oberquell, an employee of ITR Industries, reported to his employer that he injured his knee while working. After the injury was reported, fellow employees came forward and reported that Oberquell did not injure his knee while working for ITR Industries, but instead was injured while working a weekend job with their competitor, United RMR Enterprises.
During the course of CDI's investigation it was discovered that United RMR Enterprises had not reported Oberquell's injury to their workers' compensation insurance carrier State Compensation Insurance Fund (SCIF). The investigation also revealed that United RMR Enterprises was paying Oberquell, and others, cash wages and not reporting these employees on their payroll to SCIF, nor to the California Employment Development Department (EDD) for the withholding of payroll taxes. CDI conducted a forensic audit which determined that over a two year policy period, United RMR Enterprises failed to remit approximately $15,700 in workers' compensation premiums to their former carrier SCIF.
Additionally, due to the fraudulent workers' compensation claim filed by Oberquell, the loss to ITR Industries' workers' compensation carrier is estimated to be approximately $16,000.
This case is being prosecuted by the Santa Clara County District Attorney's Office.
The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $289 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $394 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 or 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.