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Individuals from two Bay Area construction companies were arraigned on charges of conspiring to misclassify workers to avoid paying workers’ compensation insurance, payroll taxes, and insurance premiums. Complaints were filed in the Contra Costa County Superior Court.

The first complaint against 57-year-old Candido Silva, 42-year-old Itamar De Morais Junior, and 42-year-old Irma Ruiz-Alarcon of Atlas Pavers of Concord details how they unlawfully paid over $12 million to its unlicensed and misclassified construction crews from 2016 through 2019.

The complaint also alleges that the defendants discussed a desire to avoid insurance with the State Compensation Insurance Fund because they knew that SCIF would require an audit of the company’s books.

The second complaint charged 62-year-old Christopher Ray Vieira and 60-year-old Gilbert Roland Guiotti with operating Centrox Construction of San Bruno as a shell company to route unlawful payments to unlicensed subcontractors for Atlas Pavers and others.

Both men have been charged with the unlawful use of their CSLB license to aid and abet payments from companies advertising to consumers as licensed contractors to their unlicensed and misclassified subcontractor labor crews.

Moreover, the complaint alleges Centrox received a percentage for routing millions of dollars in payroll funds to unlicensed and misclassified subcontractor crews — while fraudulently underreporting the worker’s total compensation amounts to SCIF.

The investigation into Atlas Pavers and Centrox Construction was conducted by the Contra Costa District Attorney’s Office, Contractors’ State Licensing Board, and the California Department of Insurance.

District Attorney Diana Becton said that “Prosecuting insurance fraud is about protecting workers, holding those responsible accountable, and stopping unlawful business schemes.”

California law requires contractors to be licensed in their specialized field, obtain workers’ compensation insurance.