Calif. Wood Chipper Death Spawns Insurance Fraud Case

October 13, 2011

The owner of an Orange County tree-trimming business faces fraud charges after filing a 2007 insurance claim for the family of an employee who died in a wood chipper. Prosecutors say he never paid premiums on the insurance.

Jose Luis Guerrero, 43, of Fullerton, was due in court for arraignment Tuesday. He is free on $500,000 bail.

Guerrero is charged with multiple felony counts of failing to file a return with the intent to evade taxes, of willfully failing to pay taxes and misrepresenting facts to the State Compensation Insurance.

In 2007, landscaper Gabriel Gonzalez, who worked for Guerrero, was killed when his body was pulled into a wood chipper, a machine that shreds tree branches into mulch. Guerrero filed an insurance claim to collect benefits for Gonzalez’s family. The state insurance fund discovered the alleged fraud while reviewing Guerrero’s business after the claim was filed.

A telephone message left for Guerrero was not immediately returned.

If convicted on all counts, Guerrero faces up to 31 years in prison.

Gonzales, 24, of Orange, died as he fed branches into the chipper on a job in a cul-de-sac in Tustin. Police, the coroner’s office and safety regulators ruled it was an industrial accident so there were no criminal charges.

From 2005 to 2009, Guerrero under-reported his payroll to the insurance fund by more than $2 million so he would have to pay less in workers’ compensation insurance premiums, prosecutors allege.

He is also accused of paying his employees in cash to avoid paying state taxes, the Orange County district attorney’s office told The Orange County Register.

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