Owner of Construction Companies Indicted for Workers’ Compensation Fraud
Used a Hidden Payroll Scheme to Evade $66,000 in Workers’ Compensation Premiums
BOSTON – The owner of two Boston-based construction companies has been indicted on charges of workers’ compensation fraud in connection with failing to obtain workers’ compensation insurance, Attorney General Maura Healey announced today.
Christopher Rapczynski, age 48, of Andover, is the president of Sleeping Dog Properties, Inc. (SDP), and New England Construction Resources (NECR). Rapczynski was indicted yesterday by a Suffolk County Grand Jury on charges of Workers’ Compensation Fraud (6 counts), Failure to Provide Workers’ Compensation Insurance (1 count) and Larceny Over $250 (5 counts). The arraignment is scheduled for a later date at Suffolk Superior Court. This investigation was referred to the Attorney General’s Office by the state’s Insurance Fraud Bureau (IFB).
“When businesses fail to carry workers’ compensation insurance it endangers their workers and raises costs for all other businesses,” AG Healey said. “We’ll continue to work with the IFB to investigate and prosecute those who engage in this type of fraud for their own benefit.”
“The IFB’s Workers’ Compensation Unit vigorously pursues premium evasion cases because it places a financial drain on the system and creates an unfair playing field for dishonest businesses,” said Anthony M. DiPaolo, Chief of Investigations at the Insurance Fraud Bureau. “This indictment shows the commitment by the IFB and AG Healey’s office to combat this type of fraud.”
Rapczynski is co-owner and president of SDP, which was established in 1997. Investigators found that between 2004 and 2006, SDP filed 11 claims with their workers’ compensation insurer resulting in a dramatic increase in the company’s workers’ compensation premium payments. Authorities allege that Rapczynski ceased obtaining and paying workers’ compensation premiums on behalf of SDP, and that he created a second company, NECR. NECR claims to employ a small number of construction foremen and supervisors who are then “leased” for large construction projects, but investigators allege that the company does not employ or insure the actual workers on these various projects.
Authorities allege that NECR and SDP are one and the same employer, and that Rapczynski established NECR for the sole purpose of hiding and failing to disclose the payroll and workers of SDP. Authorities further allege that SDP has employed several construction workers on a yearly basis since 2006, had an annual payroll of hundreds of thousands of dollars, all without having a valid workers’ compensation policy.
Rapczynski allegedly deliberately misled auditors by failing to disclose that SDP had no workers’ compensation insurance. As a result of these false representations, Rapczynski and NECR have avoided paying $66,747 in workers’ compensation premiums.
These charges are allegations and the defendant is presumed innocent until proven guilty.
AG Healey’s Insurance and Unemployment Fraud Unit works to protect consumers and the integrity of the insurance system by investigating and prosecuting those who commit fraud against all types of insurers, including the Commonwealth’s unemployment insurance and workers’ compensation systems.
This case is being prosecuted by Assistant Attorney General Kristy Lavigne with assistance from Kimberly Medeiros of AG Healey’s Insurance and Unemployment Fraud Unit with assistance from investigators at the Insurance Fraud Bureau.