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Workers’ Compensation Insurer Sues to Collect Premiums Avoided by Fraud
It’s Fraud to Lie on Application for Insurance
Post 5121
In The Commissioners Of The State Insurance Fund v. Capcon Construction Industries Corp., Capcon Construction Supply Corp., Jab Masonry Corp., Agra Masonry Inc., Agra Industries Usa Corp, A&A Masonry Corp., Alexander Shvartsberg, Darren Caputo, Maryann Furman, 2025 NY Slip Op 32359(U), Index No. 452680/2024, Motion Seq. No. 002, Supreme Court, New York County (July 2, 2025) the court dealt with a fraudulent application for workers’ compensation insurance.
BACKGROUND
On March 3, 2015, A&A Masonry Corp. applied for workers’ compensation insurance coverage from the New York State Insurance Fund (SIF).
On January 15, 2016, Agra Masonry Inc. was incorporated with Maryann Furman as the sole shareholder and President.
On January 4, 2018, SIF canceled the A&A Policy for non-payment.
On March 6, 2018, Masonry applied for workers’ compensation and employer’s liability insurance from SIF.
On November 29, 2018, SIF commenced an action against A&A seeking to recover unpaid insurance premiums.
On October 3, 2019, SIF sent Masonry a notice of cancellation.
On October 9, 2019, the Masonry Policy was reinstated after Masonry paid $6,286.47.
On February 21, 2019, SIF obtained a judgment against A&A for $333,301.65.
On June 30, 2020, Agra Industries USA Corp. was incorporated.
On October 27, 2021, SIF commenced an action against Masonry seeking recovery of unpaid insurance premiums.
On January 12, 2022, SIF obtained a judgment against Masonry in the amount of $5,398,564.69.
On September 27, 2024, SIF commenced the instant action seeking $15,521,316.45 in damages.
DISCUSSION
Insurance Fraud WCL §§ 96(2) And 93
Pursuant to WCL § 96(1), any “person who knowingly … conceals any material fact or engages in any other fraudulent scheme or device for the purpose of obtaining, maintaining or renewing insurance in the state insurance fund … shall be guilty of a class E felony.” Violations of WCL § 96(1) entitle SIF to treble damages, “or five thousand dollars, whichever is greater.” WCL § 96(2).
Here, plaintiff has provided documentary evidence and pled with sufficient particularity that Shvartsberg’s role at Masonry was omitted on the Masonry Application’s question six for the purpose of obtaining insurance, as Shvartsberg was barred from obtaining policies from the SIF Fund due to the A&A judgment under WCL § 93. Thus, defendant’s motion to dismiss the sixth cause of action should be denied.
CONCLUSIONS
Alter Ego Liability: Plaintiff has presented evidence that Masonry’s funds were diverted to make it judgment-proof.
1. Successor Liability: Plaintiff has sufficiently pled that Industries could be liable for the Masonry Judgment as the successor of Masonry.
2. DCL §273: Plaintiff has pled a voidable transfer pursuant to DCL § 273(a)(1).
3. DCL § 274: Plaintiff has alleged that Masonry’s judgment rendered it insolvent.
4. Attorney’s Fees Pursuant to DCL § 276-a: Plaintiff has sufficiently pled the prior DCL causes of action.
5. Insurance Fraud WCL §§ 96(2) and 93: Plaintiff has provided documentary evidence and pled with sufficient particularity that Shvartsberg’s role at Masonry was omitted on the Masonry Application.
ZALMA OPINION
Insurance fraud is a crime in almost every state, including the state of New York. Lying about the management of a company to hide the fact it is controlled by a person who was ineligible for insurance voids the insurance and can be criminal and, at the least, will void the insurance and holds the owners responsible for the premium charged to the various entities. Hiding behind new corporate entities to avoid premium payments is fraud in the inducement the insurer to rescind and obtain a judgment for earned premium.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Convicted Criminal Seeks to Compel Receiver to Protect his Assets
Post number 5291
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The Work of a Court Appointed Receiver is Constitutionally Protected
In Simon Semaan et al. v. Robert P. Mosier et al., G064385, California Court of Appeals, Fourth District, Third Division (February 6, 2026) the Court of Appeals applied the California anti-SLAPP statute which protects defendants from meritless lawsuits arising from constitutionally protected activities, including those performed in official capacities. The court also considered the doctrine of quasi-judicial immunity, which shields court-appointed receivers from liability for discretionary acts performed within their official duties.
Facts
In September 2021, the State of California filed felony charges against Simon Semaan, alleging violations of Insurance Code section 11760(a) for making...
When There are Two Different Other Insurance Clauses They Eliminate Each Other and Both Insurers Owe Indemnity Equally
Post number 5289
In Great West Casualty Co. v. Nationwide Agribusiness Insurance Co., and Conserv FS, Inc., and Timothy A. Brennan, as Administrator of the Estate of Pat- rick J. Brennan, deceased, Nos. 24-1258, 24-1259, United States Court of Appeals, Seventh Circuit (February 11, 2026) the USCA was required to resolve a dispute that arose when a tractor-trailer operated by Robert D. Fisher (agent of Deerpass Farms Trucking, LLC-II) was involved in a side-impact collision with an SUV driven by Patrick J. Brennan, resulting in Brennan’s death.
Facts
Deerpass Trucking, an interstate motor carrier, leased the tractor from Deerpass Farms Services, LLC, and hauled cargo for Conserv FS, Inc. under a trailer interchange agreement. The tractor was insured by Great West Casualty Company with a $1 million policy limit, while the trailer was insured by Nationwide Agribusiness Insurance Company with a $2 million ...
Opiod Producer Seeks Indemnity from CGL Insurers
Post number 5288
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Insurers Exclude Damages Due to Insured’s Products
In Matthew Dundon, As The Trustee Of The Endo General Unsecured Creditors’ Trust v. ACE Property And Casualty Insurance Company, et al., Civil Action No. 24-4221, United States District Court, E.D. Pennsylvania (February 10, 2026) Matthew Dundon, trustee of the Endo General Unsecured Creditors’ Trust, sued multiple commercial general liability (CGL) insurers for coverage of opioid-related litigation involving Endo International PLC a pharmaceutical manufacturer.
KEY FACTS
Beginning as early as 2014, thousands of opioid suits were filed by governments, third parties, and individuals alleging harms tied to opioid manufacturing and marketing.
Bankruptcy & Settlements
Endo filed Chapter 11 in August 2022; before bankruptcy it ...
Passover for Americans
Posted on February 19, 2026 by Barry Zalma
“The Passover Seder For Americans”
For more than 3,000 years Jewish fathers have told the story of the Exodus of the enslaved Jews from Egypt. Telling the story has been required of all Jewish fathers. Americans, who have lived in North America for more than 300 years have become Americans and many have lost the ability to read, write and understand the Hebrew language in which the story of Passover was first told in the Torah. Passover is one of the many holidays Jewish People celebrate to help them remember the importance of G_d in their lives. We see the animals, the oceans, the rivers, the mountains, the rain, sun, the planets, the stars, and the people and wonder how did all these wonderful things come into being. Jews believe the force we call G_d created the entire universe and everything in it. Jews feel G_d is all seeing and knowing and although we can’t see Him, He is everywhere and in everyone.We understand...
Passover for Americans
Posted on February 19, 2026 by Barry Zalma
Read the full article at https://www.linkedin.com/pulse/passover-americans-barry-zalma-esq-cfe-5vgkc.
“The Passover Seder For Americans”
For more than 3,000 years Jewish fathers have told the story of the Exodus of the enslaved Jews from Egypt. Telling the story has been required of all Jewish fathers. Americans, who have lived in North America for more than 300 years have become Americans and many have lostthe ability to read, write and understand the Hebrew language in which the story of Passover was first told in the Torah.
Passover is one of the many holidays Jewish People celebrate to help them remember the importance of G_d in their lives. We see the animals, the oceans, the rivers, the mountains, the rain, sun, the planets, the stars, and the people and ...
You Get What You Pay For – Less Coverage Means Lower Premium
Post number 5275
Posted on January 30, 2026 by Barry Zalma
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When Experts for Both Sides Agree That Two Causes Concur to Cause a Wall to Collapse Exclusion Applies
In Lido Hospitality, Inc. v. AIX Specialty Insurance Company, No. 1-24-1465, 2026 IL App (1st) 241465-U, Court of Appeals of Illinois (January 27, 2026) resolved the effect of an anti-concurrent cause exclusion to a loss with more than one cause.
Facts and Background
Lido Hospitality, Inc. operates the Lido Motel in Franklin Park, Illinois. In November 2020, a windstorm caused one of the motel’s brick veneer walls to collapse. At the time, Lido was insured under a policy issued by AIX Specialty Insurance Company which provided coverage for windstorm damage. However, the policy contained an exclusion for any loss or damage directly or indirectly resulting from ...
