Behzad Bandari, 64, of Pacific Palisades, and Sam Siam, 67, of Thousand Oaks, appeared in a Tulare County Superior Court answering to nine counts each of felony insurance fraud after allegedly underreporting more than $3.6 million in employee payroll as a part of a scheme to fraudulently reduce their company’s workers’ compensation insurance premium by $369,210.
Bandari was the Chief Financial Officer of Waterdrops Express Car Wash and Siam was the company’s Chief Executive Officer. They were identified as shareholders and managing partners in a chain of car washes operated from their corporate office in Woodland Hills.
Bandari is additionally, a Certified Public Accountant and managed the taxes on behalf of the various corporations and LLCs, doing business as Waterdrops Express Car Wash.
The car wash locations spanned across three counties, Tulare, Kings, and Ventura, and were organized under multiple corporate entities.
The California Department of Insurance began an investigation after receiving a tip from an insurance company. The tip alleged Bandari and Siam manipulated employee payroll records to reduce the premium amounts owed to their insurance company, thereby committing insurance fraud.
Department detectives uncovered Bandari and Siam underreported employee payroll to two separate insurance companies. The underreporting occurred when Bandari and Siam provided false payroll records during routine audits with the insurance companies for policy years 2014 through 2016.
A discrepancy of more than $3.6 million was discovered when detectives compared employee payroll records submitted to the insurance companies, against the employee wages reported to the Employment Development Department during the same policy years.
By underreporting the payroll to their insurance companies, Waterdrops Express Car Wash avoided paying $369,210 in premiums owed to the two insurance companies.
Bandari and Siam are scheduled to appear in court again on December 12, 2021. The Tulare County District Attorney’s Office is prosecuting this case.