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Newport Coast businessman accused of shorting and pocketing employees’ pay

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A Newport Coast man who co-owns a contracting business was one of five defendants arraigned Tuesday on charges that they made off with more than $635,000 by shorting their employees’ wages, dodging taxes and underpaying insurance, according to the Orange County district attorney’s office.

Babak Brian Abghari, 36, helps run PCN3, a general contracting company that mainly takes on public works projects, prosecutors said in a news release.

Abghari and his co-defendants are accused of paying their workers less than the wages required on taxpayer-funded projects, starting in 2000.

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Prosecutors allege they accomplished that by shorting employees’ hours on their payroll or requiring workers to hand back cash after being paid.

The defendants are accused of pocketing the excess wages.

Abghari and PCN3’s other owner, Homayoun Harry Abghari, 57, of Huntington Beach, also are accused of filing false tax returns that understated their employees’ pay and the number of hours they worked. Prosecutors say they also discouraged employees who were hurt on the job from filing workers’ compensation claims.

Abghari and his four co-defendants — Homayoun Abghari, Julio Roberto Alvarado, 47, of San Pedro, Cody Lawson, 34, of Long Beach and Phyllis Martinez, 51, of Anaheim — are each charged with eight felony counts of taking and receiving a portion of a worker’s wage on a public work, 56 felony counts of recording a false or forged instrument, six felony counts of making a false statement to discourage an injured worker from claiming benefits and seven felony counts of willful failure to pay taxes, with a possible sentencing enhancement for property loss over $200,000.

Babak and Homayoun Abghari face three additional felony charges of misrepresenting facts to a workers’ compensation insurance company.

If convicted, all five could face a maximum sentence of 49 years and six months in state prison, prosecutors said.

All have pleaded not guilty, according to court records.

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jeremiah.dobruck2@latimes.com

Twitter: @jeremiahdobruck

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