Manhattan DA Announces Indictment in $20M Cash Pay, Worker Compensation Fraud
Manhattan District Attorney Alvin Bragg, Jr., today announced the indictment of four interior construction companies, their owners, and a manager, for a conspiracy to evade more than $1.7 million in workers’ compensation insurance premiums over five years by creating a $20 million, off-the-books, cash payroll. As alleged, SOLOMON FEDER, 35, CHAIM LEIFER, 43, their companies BIG APPLE DESIGNERS, INC., and VELOCITY FRAMERS USA, INC., and manager MOSHE “MOSES” WEINBERGER, 31, colluded with CARLOS SANTANDER, 46, and others, to issue checks made payable to SANTANDER’s two companies, CIS ENTERPRISES CORP and CIS CONSTRUCTION LLC. SANTANDER then cashed the checks at commercial check cashing businesses, and paid BIG APPLE and VELOCITY workers with envelopes of cash – enabling the companies to underreport their true payrolls to the New York State Insurance Fund (“NYSIF”), and avoid paying required premiums.[1] “All workers deserve to be fully protected in the event of an on-site injury – especially in an industry as dangerous as construction,” said District Attorney Bragg. “As alleged in this indictment, instead of securing coverage for their workers, these defendants used a multi-million dollar off-the-books compensation scheme to avoid paying premiums, leaving their employees uninsured for years. My Office’s Rackets Bureau is ensuring that workers have both the safety precautions and workers’ compensation protections they need to do their jobs without fear.” According to court documents and statements made on the record in court, FEDER and LEIFER owned interior construction companies BIG APPLE and VELOCITY FRAMERS, and employed WEINBERGER to manage the companies’ day-to-day operations. From January 2016 to December 2020, they colluded with SANTANDER and others to issue checks made payable to SANTANDER’s companies. SANTANDER then cashed those checks – totaling approximately $20 million – at a commercial check cashing business. SANTANDER and others would pay BIG APPLE and VELOCITY workers with envelopes of cash handed out at construction sites, including the site of a new 13-story residential building in Downtown Brooklyn, and other locations throughout Manhattan, Brooklyn, and Queens. Each year, the companies submitted false information to NYSIF during their mandatory audits, which underreported their true payrolls by millions of dollars. In total, the off-the-books compensation scheme enabled the defendants to evade more than $1.7 million in workers’ compensation premiums. Assistant D.A. Christopher Beard is handling the prosecution of the case with Assistant D.A. Raffaela Belizaire, under the supervision of Assistant D.A.s Michael Ohm (Deputy Chief of the Rackets Bureau), Judy Salwen (Principal Deputy Chief of the Rackets Bureau), and Jodie Kane (Chief of the Rackets Bureau), Executive Assistant D.A. Christopher Conroy (Senior Advisor to Investigation Division), and Executive Assistant D.A. Susan Hoffinger (Chief of the Investigation Division). Paralegals Tyler Lopez and Yanisa Campusano assisted with the investigation. D.A. Bragg thanked the New York State Police’s Special Investigations Unit, including Superintendent Kevin P. Bruen, Major Scott F. Donn, Lieutenant Donald C. DeQuarto, Senior Investigator Mark Buglione, and assigned Investigators. D.A. Bragg also thanked the New York State Insurance Fund and Investigative Officer 1 Dominick Raspante and Senior Auditor Granville Mo. Defendant Information: SOLOMON FEDER Brooklyn, NY Charges:
Conspiracy in the Fourth Degree, a class E felony, one count
Insurance Fraud in the First Degree, a class B felony, one count
Falsifying Business Records in the First Degree, a class E felony, six counts
CHAIM LEIFER Brooklyn, NY Charges:
Conspiracy in the Fourth Degree, a class E felony, one count
Insurance Fraud in the First Degree, a class B felony, one count
Falsifying Business Records in the First Degree, a class E felony, six counts
MOSHE “MOSES” WEINBERGER Brooklyn, NY Charges:
Conspiracy in the Fourth Degree, a class E felony, one count
Insurance Fraud in the First Degree, a class B felony, one count
Falsifying Business Records in the First Degree, a class E felony, six counts
CARLOS SANTANDER Brooklyn, NY Charges:
Conspiracy in the Fourth Degree, a class E felony, one count
Insurance Fraud in the First Degree, a class B felony, one count
Falsifying Business Records in the First Degree, a class E felony, six counts
BIG APPLE DESIGNERS, INC. Brooklyn, NY Charges:
Conspiracy in the Fourth Degree, a class E felony, one count
Insurance Fraud in the First Degree, a class B felony, one count
Falsifying Business Records in the First Degree, a class E felony, six counts
VELOCITY FRAMERS USA, INC. Brooklyn, NY Charges:
Conspiracy in the Fourth Degree, a class E felony, one count
Insurance Fraud in the First Degree, a class B felony, one count
Falsifying Business Records in the First Degree, a class E felony, six counts
CIS CONSTRUCTION LLC Brooklyn, NY Charges:
Conspiracy in the Fourth Degree, a class E felony, one count
Insurance Fraud in the First Degree, a class B felony, one count
Falsifying Business Records in the First Degree, a class E felony, six counts
CIS ENTERPRISES CORP. Brooklyn, NY Charges:
Conspiracy in the Fourth Degree, a class E felony, one count
Insurance Fraud in the First Degree, a class B felony, one count
Falsifying Business Records in the First Degree, a class E felony, six counts
[1] The charges contained in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty. All factual recitations are derived from documents filed in court and statements made on the record in court.
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