California regulator accuses Fresno business owner of fraud to avoid workers’ comp dues [The Fresno Bee]

Fresno Bee, The (CA)

The former owner of a Fresno-based trucking company is facing charges of under-reporting more than $2 million in payroll to avoid workers’ compensation costs, regulators said Wednesday.

Heigo Kubar, 84, of Fresno faces three felony charges related to about a half million in workers’ compensation insurance fraud at the company he used to own, TKJ Trucking, according to the California Department of Insurance.

Kubar’s attorney, Jeffrey Hammerschmidt of Fresno, said his client has no prior criminal history. Hammerschmidt said he does not believe Kubar conducted any deception in his business practices.

The arraignment was continued and Kubar did not enter a plea on Wednesday, according to his attorney. The case may come down to technicalities in how employees and independent contractors are classified, he said.

Kubar no longer owns any of TKJ Trucking, his attorney said.

The state Department of Insurance said in a news release they conducted an audit and found between Dec. 1, 2018 and Dec. 1, 2021, Kubar reported less than $1 million in payroll when he actually had more than $3 million.

The trucking firm’s insurance company became suspicious after an employee was found dead inside a company-owned big rig, the regulator said.

The employee’s death was not suspicious and they died of natural causes, a spokesperson for the state Department of Insurance confirmed, but that employee’s job designation was allegedly changed on company paperwork after their death.

The 15-year employee had been designated as a salesperson, but after dying was designated as a truck driver. The employee had been a driver the entire 15 years, prosecutors alleged.

Workers’ compensation for drivers is about 20 times more costly than that of a salesperson, according to the regulator.

Kubar is scheduled to appear in court next on Aug. 14.