State Gets $5.5-Million Judgment in Workers’ Comp Fraud Case : Courts: Seal Beach man allegedly set up businesses and then submitted claims for fictitious employees.

In what was being termed one of the largest workers’ compensation fraud cases in recent state history, the state obtained a $5.5-million judgment against a Seal Beach man who allegedly ran a fraud scheme against the State Compensation Insurance Fund.

U.S. District Judge Terry J. Hatter Jr. ruled against Vincent M. Marconi, 63, who is awaiting extradition proceedings in England on a separate criminal case involving mail fraud charges, his attorney confirmed.

The judgment was sought by the State Compensation Insurance Fund in San Francisco after an investigation turned up evidence that Marconi fraudulently obtained insurance by setting up a network of temporary-employment agencies. He allegedly used 50 fictitious names, including those of dead people, to create agencies in cities such as Anaheim, Santa Ana, Bell Gardens, Ontario, City of Commerce, Los Angeles and San Diego.

The fictitious names were used to register a fictitious business name, apply for a business license and obtain an employer tax identification number. He then paid only a fraction of the proper insurance premiums by misrepresenting the number of workers employed, the annual payroll and their history of insurance claims. He would then submit claims.

When the state fund reviewed his operations, he would usually shut down and establish a new operation under another name, a state fund spokesman said. The judgment stems from a case filed three years ago.

Marconi’s lawyer in the civil case could not be reached for comment. The lawyer handling his criminal case said Marconi is expected to be returned from England later this month or next month.

Representatives of the State Compensation Insurance Fund, the nonprofit agency that insures half of the state’s employers on workplace injury cases, applauded the decision.

“This judgment underscores our commitment to protect the interests of honest employers and the integrity of California’s workers’ compensation system,” fund President Ken Bollier said. “We will continue to investigate cases of suspected fraud.”