Ohio Business Owner Sentenced for Failing to Maintain Workers’ Comp Coverage

An Ohio business owner has been sentenced for failure to comply with the law after amassing more than $90,000 in premiums and penalties owed on his workers’ compensation insurance policy.

Phil Kraus, owner of KC Berkshire, a janitorial service, pleaded guilty last week following an investigation by the Ohio Bureau of Workers’ Compensation (BWC) Special Investigations Department (SID).

SID’s Employer Fraud Team began investigating Kraus after he failed to enter into a payment plan after falling behind on his premiums. Kraus was previously investigated by SID for issues pertaining to under-reporting his business’ payroll, which is used to calculate premium. SID closed that case after Kraus amended the payroll reports and agreed to enter into a reinstatement payment plan to pay overdue premiums.

After several attempts to make contact with Kraus, BWC’s collections department referred the matter back to the SID as Kraus was continuing to operate his business without coverage and without establishing a payment plan. Attempts to reach Kraus regarding the lapsed policy were unsuccessful, and SID referred the case for prosecution.

Kraus pleaded no contest May 7 to two counts of Failure to Comply with Law and two counts of Attempted Failure to Comply with Law. He was sentenced to 18 months of community control, and ordered to pay $91,555 in restitution. He must also pay court costs and a $50 fee for each count.

Source: Ohio Bureau of Workers’ Compensation