Owner Of Holbrook Asbestos Removal Company Busted In Workers' Comp Fraud Underpaid Premium By $163K: DA

RIVERSIDE, NY — A Patchogue businessman and his company, VGN Enterprise Corporation, an asbestos mitigator, have been accused of concealing workforce size and safety risks to secure lower insurance rates, charged with fraudulent practices and failure to secure compensation, Suffolk County District Attorney Ray Tierney said Thursday.

Joseph Arthurs intentionally misrepresented his company’s payroll, the number of employees, and the work hazards involved a worker’s compensation insurance company, resulting in the underpayment of insurance premiums by more than $160,000, according to Tierney.

Arthurs, 56, was placed under arrest on Aug. 25, and as required by law, a desk appearance ticket was issued, prosecutors said.

Arthurs and his Holtsville-based company, VGN, were arraigned charges of penalties for fraudulent practices and effect of failure to secure compensation.

Arthurs was released on his own recognizance, and the charges are not bail-eligible under current state law.

Patch has reached out to Arthurs' defense attorney, James Hagney, of Huntington, for comment.

Arthurs and his company are due back in court on Sept. 21.

"Underrepresenting employees on worker’s compensation insurance means undercutting their safety," Tierney said. “This type of fraud strips workers of the safeguards they depend on, leaving them unprotected if they get hurt on the job."

"I thank the offices of the New York State Inspector General for their help in holding this defendant accountable and keeping Suffolk County employees safe," he added.

State Workers' Compensation Fraud Inspector General Lucy Lang said, "New Yorkers who are hurt on the job deserve a workers’ compensation system they can rely on."

“Thank you to District Attorney Tierney and both of our teams for pursuing accountability for employers who put that vital protection at risk," she added.

In March 2023, Arthurs applied for a workers’ compensation insurance policy from Wesco Insurance Company for coverage from April 2023 through April 2024, as required by state law, and stated on the application that his company employed a full-time building service contractor as the sole employee with an annual payroll of $50,000, according to prosecutors.

Based on the application, the insurance company issued a workers’ compensation policy for VGN with an annual premium of $4,203, prosecutors said.

In September 2024, an investigation by the offices of the state Inspector General determined Arthurs had obtained a state Department of Labor Asbestos License/Certification and filed multiple “Asbestos Project Notifications” with the agency, according to prosecutors.

The filings confirmed that the company was engaged in a more hazardous level of asbestos abatement and therefore required workers’ compensation coverage classified for that type of work, prosecutors said, adding that the investigation also determined VGN employed a multitude of workers during

the course of the year, with an annual payroll of $354,112.

As a result of these alleged misrepresentations, VGN significantly underpaid a total of $163,561 in insurance premiums on its workers’ compensation insurance policy, according to prosecutors.