Lafayette Woman Arrested In $32 Million Fraud Scheme: State

SAN FRANCISCO, CA — Detectives with the California Department of Insurance have arrested a Bay Area business owner for allegedly underreporting her business payroll and ripping off insurers for about $32 million.

State insurance officials announced last week that they arrested 55-year-old Marie Gregori of Lafayette, who owns GMG Janitorial, GMG Billings and Apex Janitorial Solutions. GMG is a large janitorial company operating throughout the Bay Area and Southern California and had more than 200 employees between July 2009 and December 2016.

Over a seven-year period, Gregori allegedly falsified documents and underreported payroll to her workers compensation insurance company, detectives said.

According to state insurance officials, their investigation revealed that Gregori was keeping two sets of books.

She allegedly used a payroll processing service to report to the state Employment Development Department and pay her employees, and was also keeping a fraudulent set of books that she provided to insurers and insurance auditors, which showed a significantly lower payroll amount, detectives said.

In a statement, Insurance Commissioner Dave Jones said people often make the mistake of thinking insurance fraud is a victimless crime.

"When business owners cheat the system by operating in the underground economy, they create an unfair advantage that puts legitimate business at risk," Jones said.

The investigation was led by the Department of Insurance with assistance from the San Francisco District Attorney's Office, which is prosecuting the case.

— Bay City News; Image via Shutterstock

Also See:

• Contaminated Tuna Alert: Fish With Hepatitis A Served In Some Calif. Restaurants
• Amid housing crisis, why 2 out of 5 young Californians live at home
• California's 2017 National Merit Scholarship Winners: List