New Jersey electronics recycler pleads guilty to fraud

New Jersey Attorney General Christopher Porrino and the New Jersey Office of the Insurance Fraud Prosecutor (OIFP) have announced that Supreme Asset Management Recovery (SAMR), Lakewood, New Jersey, and its owner, Albert Boufarah, have admitted to bilking nearly $600,000 from an insurance carrier by providing false and misleading information to obtain lower premiums on workers’ compensation coverage.

SAMR and Boufarah pleaded guilty to second-degree conspiracy and insurance fraud in a hearing before Superior Court Judge Wendel Daniels.

As part of the plea agreements, the state will recommend a three-year sentence for Boufarah and a fine not to exceed $200,000 for SAMR. Both defendants will be jointly and severally liable for nearly $600,000 in restitution to New Jersey Manufacturer’s Insurance Co. (NJM). Sentencing for both defendants is scheduled for March 3, 2017.

“Instead of accurately representing the risks associated with the jobs performed by SAMR employees, these defendants conspired to lie and cheat to avoid paying their fair share in premiums,” says Attorney General Porrino. “By holding both Boufarah and SAMR responsible for this criminal manipulation of the system, we are sending a message that this kind of corporate fraud will not be tolerated.”

“Workers compensation fraud undermines a system designed to financially assist employees who suffer on-the-job accidents,” says Acting Insurance Fraud Prosecutor Christopher Iu. “We will aggressively investigate and punish those exploit the system for their personal enrichment.”

According to a state grand jury indictment handed up in February, SAMR and Boufarah, along with five other defendants, misclassified SAMR employees to obtain lower workers compensation coverage from New Jersey Casualty, a subsidiary of NJM.

The defendants falsely asserted that all but a handful of SAMR’s 50 to 72 employees were office workers performing clerical tasks, according to prosecutors. An investigation revealed that in reality most of them were warehouse workers performing higher-risk jobs, such as disassembling and refurbishing televisions, computers and other electronic devices, prosecutors allege.

Also charged in the February indictment were another SAMR office and three agents with The Amato Agency LLC, an insurance agency.

All the defendants also were charged with conspiracy, insurance fraud and theft by deception in the second degree.