Monica Ung Sentenced Following Felony Convictions for Wage Fraud and Workers Compensation Fraud

OAKLAND -- Alameda County District Attorney Nancy E. O’Malley announced that defendant Monica Mui Ung, 51, owner and president of NBC General Contractor Corporation (NBC), was sentenced in Alameda County Superior Court today.

On April 18, 2011, Ung pled guilty to felony violations involving prevailing wage fraud (Labor Code 1778), workers compensation premium fraud (Insurance Code 11880), and admitted a white-collar crime enhancement (Penal Code 186.11). Today, Ung was sentenced to 4 years State Prison (execution suspended), and placed on ten years felony probation (reducible to three years if restitution is paid in full and upon further review and order of the court.) The court ordered that she pay $350,000 in restitution for the underpaid wages to the individual workers, and $850,000.00 in restitution to State Compensation Insurance Fund if paid within five years, or $1.5 million if not. The Court also stated that Ung cannot act as a contractor unless and until all restitution is paid in full and upon further order of the court.

Ung, who owned and had operated NBC since 1995, was awarded contracts for many for public works construction projects such as the Daly City Fire Station, Moscone Club House, El Cerrito City Hall, Walnut Creek Civic Center, Laney College, the Oakland Library, Willard Middle School, and Piedmont Elementary School. These projects mandated compliance with state prevailing wage laws, workers compensation insurance laws, and union labor requirements. From May 1, 2003 through May 1, 2007, NBC was awarded at least 27 public works projects in Alameda, Contra Costa, San Francisco, San Mateo and Marin counties.

NBC exploited its employees by failing to pay prevailing wages, overtime, sick leave, pension, health care, training, vacation, and other statutory benefits as required by labor laws. NBC falsely issued certified payroll reports that deliberately stated incorrect hours worked, amounts paid, and employee names. This resulted in payroll losses to forty-three individual workers identified as victims in the case between 1999 and 2008.

DA O’Malley states, “My Office is dedicated to ensuring the rights of individual workers in our community. In this case, many of the workers are non-English speaking and were fearful of coming forward. They found themselves part of a captive labor force working in the underground economy, and victimized by the predatory practices of dishonest employers. We will continue to vigorously prosecute unscrupulous employers, seek victim restitution and ensure safe and fair working conditions for all employees.”

Additionally, Ung and her staff severely under-reported to both the awarding public agencies and to her insurance company wage, hour, type of work, and benefits information for over 70 employees. NBC illegally saved a significant amount in overhead by underpaying workers’ compensation premiums and their employees’ wages. Ung’s illegal acts exposed the insurer to additional risk, robbed the employees of their proper wages and benefits, and created an unfair bidding environment for all other legitimate bidders for public works contracts. According to D.A. O’Malley, “Public works projects are normally awarded to the lowest bidder. By falsely reporting information, NBC gained a competitive advantage over honest contractors, and by underbidding, NBC was awarded jobs it might not otherwise have gotten.”

In February of 2011, NBC accountant Joey Ruan and assistant Tin Wai Wu pled guilty to four misdemeanor violations of premium fraud, prevailing wage fraud, and filing false public documents in exchange for their testimony and cooperation in the Ung case. In addition, they will serve over 390 hours of community service, be placed on three years probation and pay around $15, 000 in fines and restitution.

This case was prosecuted by the Alameda County District Attorney’s Office. The investigation was conducted by the California Department of Insurance with assistance from the Employment Development Department, the U.S. Department of Labor’s Employee Benefits Security Administration, the Division of Labor Standards Enforcement of the Department of Industrial Relations, and State Compensation Insurance Fund.

"This is clearly a case of an unscrupulous building contractor misrepresenting the facts and illegally and unfairly winning public works projects," said Insurance Commissioner Dave Jones. "My department will investigate any business owner who tries to cheat the system in order to gain an unfair advantage."

"Public dollars should not be given to employers who ignore California's laws and the state is committed to enforcement efforts that preserve a level playing field. Employers who intentionally skirt the law and defraud workers and the public have no place on public works projects," said California Labor Commissioner Julie Su. "We value our partnership with the Alameda District Attorney's office and partnering government agencies. This collaboration was vital in uncovering a multitude of illegal practices and holding this contractor fully accountable."

“This defendant showed a gross disregard for the welfare of her workers,” said Jean Ackerman, director of the U.S. Department of Labor’s Employee Benefits Security Administration’s San Francisco regional office. “This case is an excellent example of federal, state and local authorities working together. The Department of Labor will continue to work across agencies to ensure that workers keep the benefits they earn.”


Posted on Jun 24, 2011