LOS ANGELES— On May 28, 2021, Nissim Vaknin, 49, of Encino, was arraigned for felony insurance fraud after an investigation by the California Department of Insurance (CDI) revealed he allegedly underreported employee payroll by more than $70 million in order to fraudulently reduce his business’ premium for workers’ compensation insurance by more than $25 million.
The State Compensation Insurance Fund (SCIF) filed a suspected fraudulent claim in 2018 with CDI after a routine payroll audit for Van Nuys-based NV Construction, owned by Vaknin, identified large discrepancies.
CDI detectives conducted a search warrant of NV Construction’s bank records, which showed that for the policy period of October 2014 through March 2018, Vaknin reported a total of $4,083,483 in payroll to SCIF; however, CDI’s investigation found the actual payroll was $74,741,381. Vaknin allegedly under-reported payroll by more than $70 million, resulting in a premium loss to SCIF of $25,129,032.
“This alleged crime works against employees, businesses operating in California and the insurance fund,” said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona. “CDI detectives are very good at what they do, and with today’s technology and cross-checking, business owners should think twice about under-reporting payroll due to their own greed, it will catch up with them.”