• Skip to main content
  • Skip to primary sidebar
  • Skip to footer
  • Contact Us
  • Sponsor An Email
  • Post A Job
  • Merger & Acquisition Services

Agency Checklists

Massachusetts Insurance News & More

You are here: Home / Latest News / Construction. Co. Owner Pleads Guilty To $1 Million Tax And Workers’ Compensation Fraud

Construction. Co. Owner Pleads Guilty To $1 Million Tax And Workers’ Compensation Fraud

November 8, 2021 by Owen Gallagher


The owner of a Peabody construction company, Argyrios Mavros, also known as Eric Mavros, 57, has pleaded guilty in Boston’s federal court to a $1 million scheme to defraud his company’s workers’ compensation insurer of premiums and the IRS of payroll taxes by failing to disclose how many workers he employed and paid in cash

Before ceasing operations and being dissolved by the Secretary of State, Mr. Mavros owned Mavros Construction, Inc., which operated out of 7B Webster Street, Peabody.

Mavros Construction provided roofing and carpentry services to residential customers in the Boston area. Between 2011 and 2016, the company would have at any one time between five and thirteen employees working on the company’s residential jobs.

Mr. Mavros converted $3.3 million of customers’ payment checks into cash

Although Mavros Construction’s clients would pay Mr. Mavros with checks, he mostly did not deposit these payments in the company’s bank account. Instead, he processed the checks through a Peabody check-cashing business.

Between 2011 and 2016, Mr. Mavros cashed more than $3.3 million in customer checks at this local check-cashing business to get cash to, in part, pay the company’s employees under the table.

Failure to withhold employment taxes and file quarterly statements

As part of his check-cashing scheme, Mr. Mavros did not report the correct number of employees or their wages in quarterly corporate tax filings. As a result, Mr. Mavros’ company did not pay Social Security and Medicare taxes on its employee wages nor any withholding on these cash wages for federal income taxes.

Consistent with failing to report the cash wages he was paying his employees, Mr. Mavros did not provide for any workers’ compensation insurance audit of his company’s payroll, accurate employment, employee tax withholding records, or bank records to verify the correct payroll figures. This suppression of correct payroll information defrauded his company’s insurer of premiums that the company should have paid based on the remuneration of its actual employees. 

The fraud scheme avoided more than $1 million in federal taxes and insurance premiums

The federal prosecutors involved in Mavros’ case allege that he caused his company to fail to pay federal employment taxes and employee withholding taxes on more than $2.5 million in wages, resulting in over a $1 million tax loss and insurance premium underpayment.

Ten counts of tax fraud and one count of insurance fraud by use of the mails

Based on the evidence gathered by special agents of the IRS and investigators from the Massachusetts Insurance Fraud Bureau, a federal grand jury indicted Mr. Mavros in September 2020 on ten counts of employment tax fraud and one count of mail fraud involving insurance premium suppression.

The charge of failure to collect and pay over taxes provides for a sentence of up to five years in prison, three years of supervised release, and a fine of $10,000. The charge of mail fraud provides for a sentence of up to 20 years in prison, three years of supervised release, and a fine of $250,000 or twice the gross gain or loss, whichever is greater.

Sentencing scheduled for February 2022 after completion of a presentence report

The scheduling of a sentencing hearing in federal court must allow for the United States Probation Office to conduct a presentence report. The defendant must receive the completed report at least thirty-five days before the sentencing hearing.

In compiling the report, the Probation Office will interview the defendant and investigate the defendant’s history and characteristics, including: (i) any prior criminal record; (ii) the defendant’s financial condition; and (iii) any circumstances affecting the defendant’s behavior that may be helpful in imposing sentence or in correctional treatment.

Also, the report will identify for the judge all applicable federal sentencing guidelines and calculate the defendant’s offense level and criminal history category; state the resulting sentencing range and kinds of sentences available. The report may also contain, when appropriate, any basis for the judge departing from the applicable recommended sentencing range and non-prison programs and resources available to the defendant.

Senior District Court Judge William G. Young has scheduled Mr. Mavros’ sentencing for Feb. 17, 2022.

The prosecution team involved in Mr. Mavros’ case

Acting United States Attorney Nathaniel R. Mendell and Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement. The Insurance Fraud Bureau of Massachusetts also provided the federal authorities with valuable assistance. Assistant U.S. Attorney Kristen A. Kearney of Mendell’s Securities, Financial & Cyber Fraud Unit is prosecuting the case.

Print Friendly, PDF & Email

Filed Under: Latest News, MA Insurance Law | Insurance Fraud Tagged With: Agency Checklists, insurance fraud Massachusetts, Mass. Insurance News, massachusetts insurance news, New England Insurance News, Workers comp fraud massachusetts

About Owen Gallagher

Owen Gallagher is an experienced insurance litigator as well as a certified mediator and arbitrator who specializes in insurance industry disputes. His interest and affinity for insurance began at a young age working the counter at his father’s assigned risk agency in Roxbury. Over the course of his career, Owen has argued a number of cases in the Massachusetts Supreme Judicial Court and has helped agents, insurance companies, and lawmakers alike with the complexities and idiosyncrasies of insurance law in the Commonwealth.  Owen can be reached here.

Primary Sidebar

Sponsored

Latest Agency Sales

Cross Insurance Acquires Two More Massachusetts Insurance Agencies & Opens A New Office in Newburyport

Q1-2022 Sees A Decline in U.S. Mergers & Acquisitions Activity

Insurance Agency Mergers & Acquisitions in Mass. | Q1-2022

Insurance Agency Mergers & Acquisitions in Mass. | Q1-2022

Renaissance Alliance Services New Members

Renaissance Alliance Moving to the Mid-West

More Agency Sales

Career News

Alera Group Expands Northeast Regional Leadership Team

A.I.M. Mutual Elects Daniel A. Landers President & Chief Executive Officer

A.I.M. Mutual Elects Daniel A. Landers President & Chief Executive Officer

Jackson Lee Davis joins MassMutual as New Head of Diversity, Equity & Inclusion

Jackson Lee Davis joins MassMutual as New Head of Diversity, Equity & Inclusion

Liberty Mutual Insurance Creates New Global Executive Leadership Positions

Liberty Mutual Insurance Creates New Global Executive Leadership Positions

Alera Group Enhances Client Experience and Accelerates Growth with Appointment of Three Regional Managing Directors

In Memoriam

In Memoriam: Daniel Rizzo, 1937-2022

In Memoriam: Bruce MacDonald 1935-2022

In Memoriam: Bruce MacDonald 1935-2022

In Memoriam: William "Bill" Carter, Jr. 1932-2022

In Memoriam: William “Bill” Carter, Jr. 1932-2022

CAR News

17 Bullet Points on The New Insurance Labor Rate Report

2nd Look 2022: The Massachusetts Private Passenger Auto Insurance Marketplace

2nd Look 2022: The Commercial Auto Insurance Marketplace in Massachusetts

1st Look 2022: The Commercial Auto Insurance Marketplace in Massachusetts

View More CAR News

Massachusetts Law Updates

5 Points On New Ruling: Unreasonable Storage Reduces ACV Payment

A short opinion with a disproportionate impact on first-party property damage total loss claims.

Agency Checklist article on COVID-19 Closings in Massachusetts

First State High-Court COVID-19 Decision On Business Interruption Claims

Dismissed by Superior Court, the restaurants took their appeal directly to the SJC.

Vermont Mutual Asks High Court to Reverse Decision $215,000 Attorney Fee Award Payable As Damages under Bodily Injury Coverage

An unusual case involving a breach of warranty claim under Chapter 93A and whether mandatory attorney fee awards apply.

Court Rules Zurich’s Auto Policy Provides Victim No Coverage for Rape by Tow Company Driver

An Accident Followed by a Sexual Assault Leads to Coverage Suit

More Mass. Law Updates

DOI News

The 2022 MA Home Insurance Report | Part I

Mass. Business Entity License Renewals on Hold

DOI Fines Producer $1,250 For Prior Failures To Report After License Lapses

Mass. DOI Announces Its Transition to NAIC’s State Based Systems

View More DOI News

Insurance Fraud

Quinn Group Ins. Owner’s Trial to Begin on Federal Benefit and Social Security Fraud Today

First Guilty Plea in No-Fault PIP Auto Insurance Fraud Scheme

GM Financial Will Pay Over $1.8 Million For GAP Coverage Refunds and Loan Violations

Insurance Agency To Pay $100,000 Fine And $515,000 In Restitution Under Consent Decree

More Insurance Fraud News

Footer

Agency Checklists

About us
Contact us

14 Summer Street
Suite 102
Malden, MA 02148
617-598-3800

Advertise on Agency Checklists

We offer a variety of ways to get help promote your company or product.

Announcements
Email Sponsorships
Partnerships
Custom Collaborations

*Affiliate Disclosure

Please note that any of Agency Checklists’ articles might contain one or more affiliate links. This means that any subsequent purchase resulting from these links may result in a commission for us, but at no additional cost to you. For example, as an Amazon Associate, Agency Checklists earns a commission from all qualifying purchases. By working with affiliates we can continue to keep Agency Checklists subscription free. Thank you for your support.

SEARCH OUR SITE

Explore Our Archives

Copyright © 2022 · Agency Checklists · All rights reserved.

 

Loading Comments...