Eight Indicted by San Diego County Grand Jury for Fraud

Eight Massachusetts residents have been indicted for insurance premium fraud charges by a San Diego County grand jury. The eight owners and employees of Massachusetts-based National Independent Contractors Association (NICA) face arraignment on 50 felony insurance fraud charges.

The San Diego County District Attorney’s office is prosecuting this case. Defendants Thomas M. McGrath, 44; Eileen Rogantino, 42; Wesley McClure, 46; Daniel M. Curran, 53; Mary Jayne Graham, 51; Timothy F. Bergin, 36; Andrew Rogantino, 46; and David B. Kenyon, 58, are charged with one count of conspiracy to commit premium fraud; six counts of premium fraud; and 43 counts of filing false injury claims in a scheme totaling more than $600,000 in losses from the San Diego District Office of State Compensation Insurance Fund (SCIF). If convicted of all charges, the defendants face up to 59 years in prison and a fine of $1.2 million.

NICA is a privately owned company founded by Thomas McGrath in the state of Massachusetts. It was incorporated in 1995 and hailed itself as an alliance of independent contractors. NICA does business throughout the country and contracts with courier, messenger and delivery service companies in order to convert their employees into independent contractors.

On October 2002, defendants McGrath and Rogantino, officers of NICA, contacted a San Diego County insurance broker to apply for and receive a workers’ compensation insurance policy from the San Diego District Office of SCIF. Over the course of the next year, NICA reported 47 claims for injured workers whom in fact were injured, however not all 47 workers were employed with NICA. In actuality, NICA employed only a few of the 47 employees. These workers’ comp claims involved bicycle, motorcycle and motor vehicle couriers.

The California Department of Insurance assisted in this investigation and worked with the Massachusetts State Police in obtaining and serving a search warrant for the office of NICA.

“This major investigation was successful because of tremendous help from the California Department of Insurance, with assistance from the Employment Development Department and the State Compensation Insurance Fund,” said District Attorney Bonnie Dumanis.

Source: California Department of Insurance