The Monterey County District Attorney announced that Chang Tai Lin, age 53, of Salinas, pled to two counts of making a material misrepresentation in order to obtain a lower workers’ compensation insurance premium and one count of willfully failing to file payroll tax returns with intent to evade tax.
The defendant was the owner of the AA Buffet, located in Valley Center, 910 S. Main Street, Salinas. Its lunchtime customers often include tourists on charter buses.
Sentencing is scheduled for April 19, 2017 in front of the Honorable Andrew G. Liu. The maximum sentence for the charges is six years, eight months incarceration; however it is anticipated the defendant will be placed on felony probation. The restitution of $42,778.81 to EIG Services and Sequoia Insurance was paid in full at the time of the plea.
In May, 2015, operating on a tip from District Attorney Investigator Fred Lombardi, the Monterey County District Attorney’s Office [MCDA], Workers’ Compensation Fraud Unit began an investigation into the AA Buffet conducting surveillance, obtaining documents from the Salinas Police Department, Monterey County Health Department, insurance companies and state government agencies.
A search warrant was served on March 10, 2016 at the AA Buffet and the defendant’s home. MCDA was assisted in the service of the search warrant by the California Department of Insurance and the Labor Commissioner’s Office.
The investigation revealed the defendant had committed premium fraud from April 2010 through April 2016 by under reporting the number of employees and falsely reporting payroll wages as he paid many employees in cash.
The defendant was also charged with tax evasion in that from Oct 2010 through Jan 2016 he did not accurately report employee wages and payroll taxes to the Employment Development Department.
The defendant was served with an administrative citation issued by the Labor Commissioner’s Office in the amount of $200,224.98, of which almost $150,000.00 involved the underpayment of employees and would be returned to the employees upon payment.
The case was investigated by MCDA District Attorney Investigators George Costa and Martin Sanchez.