Lawyer Convicted of Workers’ Compensation Fraud
Post 5031
Read the full article at https://www.linkedin.com/pulse/guilty-paying-kickbacks-cappers-defraud-insurers-zalma-esq-cfe-9uybc, see the full video at https://rumble.com/v6r8bl0-guilty-paying-kickbacks-and-cappers-to-defraud-insurers.html and at https://youtu.be/ZXEaXW1pGZs and at https://zalma.com/blog plus more than 5000 posts.
In The People v. Jon Woods, G061948, California Court of Appeals, Fourth District, Third Division (March 18, 2025) a jury convicted Jon Woods of 37 felony counts of workers’ compensation fraud.
Woods was a worker’s compensation attorney who had made business arrangements that involved unlawful kickback and referral fees.
Woods contended that the Williamson rule (In re Williamson (1954) 43 Cal.2d 651, 276 P.2d 593) precluded convictions on counts 5 through 37. The Williamson rule states that where the Legislature has defined a specific crime with a lesser punishment, the conduct described by that crime may not be charged as a more general crime with a harsher punishment. Woods argued that his conduct was covered by a more specific statute, Labor Code section 139.32, which makes it a misdemeanor to refer work to third-party servicers in exchange for compensation.
THE WORKERS’ COMPENSATION SYSTEM
Workers’ Compensation is a scheme where employers agree to promptly compensate employees for injuries sustained on the job regardless of fault, and employees agree to the limited remedies available under the scheme.
The Legislature passed laws to protect insurers and the overall workers’ compensation system from abuse, including making it a crime to participate in a kickback scheme which was the criminal conduct of Woods, Gonzales and Arguello.
FACTS
Woods arranged with Edgar Gonzales to use copy services business called USA Photocopy, which provided subpoena services for workers’ compensation attorneys. USA Photocopy paid for some of Woods’s business expenses, including the salary of certain employees hired by Woods.
Woods’s arrangement with Arguello involved a marketing company that advertised to obtain workers’ compensation clients. Using Arguello’s copy service for subpoenas was a condition of engaging his advertising service. Woods paid Arguello’s businesses $1,425,000 in fees for advertising services over the course of their relationship.
Arguello pleaded guilty to federal criminal charges related to worker’s compensation fraud and was sentenced to four years in federal prison. He also pleaded guilty to charges brought by the Orange County District Attorney.
The Attorney General alleged four aspects of Woods’s relationships with Gonzales and Arguello that were illegal. These included operating as a runner or capper service, providing fully signed and retained clients prior to any interaction with Woods, a quid pro quo arrangement, and an illegal cross-referral service.
After conviction Woods was sentenced to four years in prison and ordered to pay restitution in the amount of $701,452.
THE APPEAL
Woods appealed, and the court reversed counts 5-37 based on the Williamson rule. Woods contended that his conduct is covered by a more specific statute that criminalizes kickback schemes, which is what Woods was accused of participating in, Penal Code Section 550.
DISCUSSION
Absent some indication of legislative intent to the contrary, the Williamson rule applies and there does not need to be perfect overlap between the general and specific statutes.
The People’s theory of how Woods violated Penal Code section 550 was precisely that he violated Labor Code section 139.32 and, therefore, the Williamson rule applies. The Court of Appeals agreed with Woods under these circumstances, and thus reversed his conviction on counts 5-37. This will also require reversal of the white-collar sentencing enhancement based on these charges, as well as a restitution award based on these charges. The restitution order of $701,452 was reversed without prejudice to the court reassessing restitution at a new sentencing hearing. In all other respects, the judgment was affirmed.
ZALMA OPINION
A lawyer committing fraud taking advantage of the Workers’ Compensation system where his crimes resulted in more than a million dollars of kickbacks and payment for cappers who illegally signed up clients for Woods. The court only found that the state overcharged Woods and required him to serve an appropriate sentence for his fraud on the Workers’ Compensation system, employers and their insurers. Jail and an appropriate amount of restitution to the defrauded insurers should be assessed.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Please tell your friends and colleagues about this blog and the videos and let them subscribe to the blog and the videos.
Subscribe to my substack at https://barryzalma.substack.com/subscribe
Go to X @bzalma; Go to the Insurance Claims Library – https://lnkd.in/gwEYk
Refusal to Provide Workers’ Compensation is Expensive
Post 5240
Read the full article at https://lnkd.in/guC9dnqA, see the video at https://lnkd.in/gVxz-qmk and at https://lnkd.in/gUTAnCZw, and at https://zalma.com/blog plus more than 5200 posts.
In Illinois Department of Insurance, Insurance Compliance Department v.USA Water And Fire Restoration, Inc., And Nicholas Pacella, Individually And As Officer, Nos. 23WC021808, 18INC00228, No. 25IWCC0467, the Illinois Department of Insurance (Petitioner) initiated an investigation after the Injured Workers’ Benefit Fund (IWBF) was added to a pending workers’ compensation claim. The claim alleged a work-related injury during employment with the Respondents who failed to maintain workers’ compensation Insurance.
Company Overview:
USA Water & Fire Restoration, Inc. was incorporated on January 17, 2014, and dissolved on June 14, 2019, for failure to file annual reports and pay franchise taxes. It then operated under assumed names including USA Board Up & Glass Co. and USA Plumbing and Sewer. The business ...
Arsonist Incompetently Moves Pro Se to Avoid Prison
Post 5239
Read the full article at https://lnkd.in/gRX8TfKn, see the video at https://lnkd.in/gY3Jvnqp and at https://lnkd.in/gRCaaf-3, and at https://zalma.com/blog plus more than 5200 posts.
In Christopher A. Barosh v. Morris Houser, et al., Civ. No. 22-0769, United States District Court, E.D. Pennsylvania (November 25, 2025) a convicted arsonist and insurance fraudster moved the USDC acting in Pro se filed Objections to Magistrate Judge Reid’s Recommendation that the US District Judge dismiss his § 2254 Petition to avoid jail.
BACKGROUND
In October 2005, Barosh set fire to his girlfriend’s Philadelphia home — some 25 hours before the cancellation of the property’s insurance policy. Several witnesses saw Barosh leaving the property shortly before the fire erupted. After the fire, Barosh made “two separate admissions of guilt.”
He attempted to pay an acquaintance to provide him with an alibi for the time of the arson. The eyewitnesses, brother, and ...
Conditional Release Allows Supplemental Claims
Post 5238
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A Release Should Totally Resolve Dispute
In Harvey et al. v. Hall, No. A25A1774, Court of Appeals of Georgia, Fourth Division (December 3, 2025) Paul Harvey, an employee of Arthur J. Dovers (d/b/a 3D Mobile Home Services), drove a truck towing a trailer loaded with machinery and equipment. Harvey fell asleep, veered off the road, and crashed into a culvert, causing Lamar Hall serious injuries.
FACTS OF SETTLEMENT
On August 18, 2020, Hall signed a limited liability release under OCGA § 33-24-41.1, releasing Harvey, Dovers, and their insurer (Georgia Farm Bureau Insurance Company) from liability for the accident in exchange for $50,000, “except to the extent other insurance coverage is available which covers the claim.”
Dovers’s general liability insurer (Republic-Vanguard ...
The Professional Claims Handler
Post 5219
Posted on October 31, 2025 by Barry Zalma
An Insurance claims professionals should be a person who:
Can read and understand the insurance policies issued by the insurer.
Understands the promises made by the policy.
Understand their obligation, as an insurer’s claims staff, to fulfill the promises made.
Are competent investigators.
Have empathy and recognize the difference between empathy and sympathy.
Understand medicine relating to traumatic injuries and are sufficiently versed in tort law to deal with lawyers as equals.
Understand how to repair damage to real and personal property and the value of the repairs or the property.
Understand how to negotiate a fair and reasonable settlement with the insured that is fair and reasonable to both the insured and the insurer.
How to Create Claims Professionals
To avoid fraudulent claims, claims of breach of contract, bad faith, punitive damages, unresolved losses, and to make a profit, insurers ...
The History Behind the Creation of a Claims Handling Expert
The Insurance Industry Needs to Implement Excellence in Claims Handling or Fail
Post 5210
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry. This statement of my philosophy on claims handling starts with my history as a claims adjuster, insurance defense and coverage lawyer and insurance claims handling expert.
My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
I was initially sat at a desk reading a text-book on insurance ...
The History Behind the Creation of a Claims Handling Expert
The Insurance Industry Needs to Implement Excellence in Claims Handling or Fail
Post 5210
This is a change from my normal blog postings. It is my attempt. in more than one post, to explain the need for professional claims representatives who comply with the basic custom and practice of the insurance industry. This statement of my philosophy on claims handling starts with my history as a claims adjuster, insurance defense and coverage lawyer and insurance claims handling expert.
My Training to be an Insurance Claims Adjuster
When I was discharged from the US Army in 1967 I was hired as an insurance adjuster trainee by a professional and well respected insurance company. The insurer took a chance on me because I had been an Army Intelligence Investigator for my three years in the military and could use that training and experience to be a basis to become a professional insurance adjuster.
I was initially sat at a desk reading a text-book on insurance ...
