Contractor sent to prison for 10 years for fraud, conspiracy, wage and grand theft and perjury

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Construction of the Tercero II South Phase in Davis California
Construction of the Tercero II South Phase in Davis California (Yolo County DA)

A Colorado-based contractor has been sentenced to 10 years in state prison for insurance fraud, conspiracy, wage theft, perjury and grand theft relating to a fraudulent contractor’s licence to build student residences at UC Davis.

The Yolo County District Attorney’s Office said in a statement that On November 13, 2019, 56-year-old Colorado man Earl “EJ” Thompson , 56, was sentenced on Nov. 13 by David Rosenberg in court in Woodland.

The DA’s office said in its statement that after Thompson’s California Contractor’s License was revoked for fraud, he convinced his wife and friend to put their names on a new business, Russell/Thompson, which he would secretly run using the fraudulent contractor’s license they obtained.

“Thompson used that business to obtain a contract with UC Davis to build some of the Tercero South student housing. During the construction, Thompson stole $633,199.55 in wages from his employees, defrauded his workers’ compensation insurance carrier, California State Compensation Insurance Fund, for $359,011.43, committed multiple acts of perjury to conceal his fraud, and caused a total loss of over $2 million,” the DA’s office said.

Deputy District Attorney Jennifer McHugh prosecuted the case which included over 35,000 pages of discovery, more than 60 defrauded employees, and involved 26 felony counts.

“Over the course of the six years it took to prosecute the case, the defense filed multiple motions to dismiss counts or enhancements and the case was further delayed when Thompson claimed to be incompetent to stand trial. Ultimately the Court deemed Thompson competent to stand trial and criminal proceedings were reinstated,” the statement said.

On July 10, 2019, Thompson plead no contest to all charges pending against him and the Court heard evidence on the enhancements. On  Nov. 13, the court found Thompson ineligible for probation and sentenced him to 10 years in state prison. The court considered Thompson’s extensive history of committing similar offenses, his prior felony convictions for insurance fraud and tax evasion, the sophisticated nature of Thompson’s fraud and the position of leadership that Thompson took in committing the crime.

“Mr. Thompson has spent his life defrauding innocent people with sophisticated fraud schemes,” McHugh said. “After getting out of prison for insurance fraud and tax evasion in 1995, he continued defrauding unsuspecting victims in California. He not only stole money from his employees during a time when they were struggling to pay their bills, he stole a profitable construction contract from other legitimate contractors and their employees.”

The Yolo County District Attorney’s Office praised the dedication and perseverance of the investigating agencies in this case, whose diligent work made this sentence possible. The investigation was a joint effort between the Yolo County District Attorney’s Workers’ Compensation Fraud Unit, the Department of Industrial Relations, the Contractor’s State License Board, the California Department of Insurance, California State Compensation Insurance Fund, and the Shasta County District Attorney’s Office.

“Judge Rosenberg’s sentence in this case recognizes the significant impact fraud of this magnitude has on California’s businesses, the economy and every person in the State, not to mention the victim employees in this case,” said District Attorney Jeff Reisig. “Premium fraud and wage theft make the cost of doing business unobtainable for some as it allows unscrupulous individuals to prey upon the unsuspecting for personal gain. This prosecution helps level the playing field for those law-abiding businesses and protects workers’ rights.”

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