King City contractor pleads no contest to insurance fraud and tax evasion

The owner of Hernandez Roofing pleaded no contest to three felony counts involving insurance fraud and tax evasion on Friday.

Between 2013 and 2016, investigators said 38-year-old Hector Hernandez got a workers compensation insurance policy for Hernandez Roofing through the State Compensation Insurance Fund, but told the SCIF that he did not have any employees to pay lower insurance premiums.

In February 2016, the District Attorney’s Office opened an investigation and got building permits. Investigators said the permits showed that Hernandez handled about 96 roofing jobs in three years and found out that Hernandez had at least three employees after talking to workers and homeowners. They also said bank records showed that he paid employees in cash without withholding state payroll taxes.

The District Attorney’s Office estimates that Hernandez defrauded the SCIF of $159,059 in premiums. Felony charges were filed against Hernandez in January 2018, and they included intentionally misrepresenting his payroll to the SCIF to get lower premiums and payroll tax violations of the Unemployment Insurance Code.

Hernandez will be sentenced in January 2020.