The former head of Orange’s Checkmate Staffing Inc., which state and police investigators raided in 2003, has been arrested on suspicion of workers’ compensation premium fraud, according to industry publication Insurance Journal.
Luis Perez, founder and former chief executive of defunct employment agency Checkmate, was among four people arrested or wanted in the investigation by the state’s Department of Insurance’s fraud division.
The San Bernardino County district attorney’s office is handling the case. It suspects the former Checkmate executives of committing more than $39 million worth of workers’ compensation premium fraud against three insurance companies.
Perez, who lives in Dove Canyon, was arrested this week at his work in Foothill Ranch, according to Insurance Journal. He was booked into Orange County jail with bail set at $10 million.
He and the others are set to be charged with one count of conspiracy to commit workers’ compensation insurance fraud and one count of conspiracy to commit denial of workers’ compensation insurance benefits.
The others arrested: Paul Rodas of Costa Mesa, Elizabeth Waldo of Yorba Linda and Oscar Hidalgo of Yorba Linda.
An arrest warrant is out for Javier Chavolla of Yorba Linda.
All were owners or key employees of Checkmate and related companies.
They are suspected of underreporting or misclassifying employees to several insurance companies, including State Compensation Insurance Fund, Zurich American Insurance Co. and Redland Insurance Co.
Checkmate grew to be one of Orange County’s biggest Hispanic-owned businesses. It specialized in light industrial and warehouse workers for customers such as Staples Inc. and Home Depot Inc.
After the raid, Checkmate filed for bankruptcy reorganization with most of its business being bought by Santa Barbara-based Select Personnel Services for about $5 million.
