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New York City Contractor Indicted for $1M Insurance Fraud

United States Manhattan District Attorney Cyrus R. Vance Jr. and New York City Department of Investigation (DOI) Commissioner Margaret Garnett announced the indictment of Dragonetti Brothers Landscaping, Nursery, & Florist (DBLNF) and D.B. Demolition Inc., as well as their respective presidents Nicholas Dragonetti and Vito Dragonetti for evading more than $1 million in insurance premiums while working on City of New York contracts for sidewalk and road repair.

The defendants are charged in a New York State Supreme Court indictment with various counts of insurance fraud, offering a false instrument for filing in the first degree and penalties for fraudulent practices under New York state’s Workers’ Compensation Law.

The indictment follows a joint investigation led by the Manhattan District Attorney’s Office’s Construction Fraud Task Force and DOI, with assistance from the New York City Business Integrity Commission (BIC).

“When companies evade insurance premiums, they put their workers at risk of not receiving adequate insurance to cover on-the-job injuries,” Vance said in a press release issued by his office. “Inadequate coverage is a particularly concerning prospect in the construction industry, where workers put their bodies on the line. As alleged in this case, the defendants devalued their workers’ livelihoods by insuring them for lower-risk work while simultaneously sending them to carry out demolition projects and operate heavy machinery.”

Since 1998, DBLNF has secured more than a hundred New York City contracts for parks landscaping and maintenance, as well as for sidewalk reconstruction and pedestrian crosswalk ramp construction. Sidewalk and ramp construction workers have higher-risk jobs than landscapers or florists which include demolishing and replacing pavement and ramps, and accordingly, a higher workers’ compensation insurance classification.

According to court documents and statements made on the record in court, between 2017 and 2019, DBLNF intentionally misclassified numerous employees on its applications to the New York State Insurance Fund (NYSIF) for workers’ compensation insurance in order to avoid paying the required premiums.

DBLNF bid on and won contracts for excavation, sidewalk reconstruction and pedestrian ramp replacement for residential blocks throughout the city totaling millions of dollars and falsely classified 217 laborers, foremen and heavy-equipment operators as florists, office workers or sales representatives. As a result, DBLNF evaded more than $1 million in insurance premiums.

During the same time period, D.B. Demo also misclassified several workers in NYSIF paperwork, claiming the individuals were office workers while simultaneously listing them as commercial drivers in paperwork filed with BIC, the agency that oversees the private carting industry in New York City. In total, D.B. Demo evaded more than $81,000 in insurance premiums.

Source: Manhattan District Attorney’s Office

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