A Florida construction company owner paid $9,297.43 for a year of workers’ compensation insurance while allegedly leaving nearly $1 million in payroll unreported. Investigators say the concealed payroll cost his insurer another $100,565.57 in premiums.
Israel Carballo was arrested November 5, 2026, on charges of grand theft, organized scheme to defraud and workers’ compensation fraud. The Florida Department of Financial Services announced the case November 10.
The investigation concerns Carballo Group LLC and a Nor-Guard Insurance policy covering September 26, 2023, through September 26, 2024. Detective A. Rojas identified Carballo as the company’s president in a complaint/arrest affidavit filed in Miami-Dade County.
Investigators obtained records from check-cashing businesses and five companies that hired Carballo Group to provide labor. Those records formed the basis of the alleged payroll discrepancy and the insurer’s calculation of the premium it should have received.
Five Companies Paid More Than $1 Million for Labor
A two-page excerpt of the November 5 complaint/arrest affidavit says five companies paid Carballo Group a combined $1,074,278.71 by check. Their representatives confirmed that the payments were exclusively for subcontracted labor.
Rojas wrote that Carballo used money service businesses in South Florida to cash checks received from contractors. Subpoenaed paperwork showed that he was authorized to cash checks for the company, and the businesses supplied photographs identifying him as the person who cashed them.
Insurer Calculated a $109,863 Annual Premium
The company applied for coverage using an estimated annual remuneration of $105,000, according to the affidavit. Investigators later identified $968,278.71 in unreported payroll exposure during the policy period.
A Nor-Guard representative told investigators that the company was required to report wages, job classifications and employee numbers so the insurer could calculate its premiums. The representative said neither Carballo nor another company representative reported significant payroll changes.
The affidavit puts the appropriate annual premium at $109,863, compared with the $9,297.43 paid. Investigators calculated the insurer’s resulting premium loss at $100,565.57.
Carballo Pleaded Not Guilty and Was Released on Bond
A two-page written not-guilty plea, signed by Assistant Public Defender Rebecca Coury, was filed November 5. The filing also requests discovery and a jury trial.
The Miami-Dade court docket for case F-26-021905 records bonds of $5,000 on each of two counts and $2,500 on the third, totaling $12,500. It records surety bonds and listed Carballo as not in jail when reviewed November 14. He is presumed innocent unless proven guilty.
Keep Payroll Reports Accurate and Preserve Payment Records
Florida’s workers’ compensation reporting law requires payroll information and access to records needed for insurance audits. Keep payroll and payment records, check that the information reported to the insurer matches the business’s actual operations, and ask the carrier how to report changes affecting the policy.
Employees and business owners who suspect payroll is being concealed to reduce insurance premiums can report it through Fraud Free Florida or call 1-800-378-0445. Preserve relevant payroll documents, payment records and communications to support the report.