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Businesses underreported more than $78 million in payroll

LOS ANGELES, Calif. – Sung Hyun Kim, 57, and her sister Caroline Choi, 59, CEOs of sewing companies that were subcontracted by True Religion Brand Jeans were arrested yesterday along with their CPA, Jae Kim, 71, on 18 felony counts of workers’ compensation insurance fraud totaling more than $11 million in losses. The three allegedly conspired to underreport $78.5 million in payroll to multiple insurers including the State Compensation Insurance Fund and two insurance companies owned by Berkshire Hathaway.

According to California Department of Insurance detectives, sisters Kim and Choi, CEOs of Meriko, Inc. and SF Apparel, Inc., allegedly conspired with their CPA to hide tens of millions in payroll to avoid paying workers’ compensation insurance premiums. Their underground economy conspiracy led to multi-million dollar premium losses for several workers’ compensation insurers including State Fund.

 

To read this article in its entirety visit insurance.ca.gov

 

 

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