A Patchogue man and owner of an asbestos removal company was charged with workers’ compensation insurance fraud for allegedly intentionally misrepresenting his company’s payroll, the number of employees and the work hazards involved to the workers’ compensation insurance company. The alleged fraud resulted in the underpayment of insurance premiums by more than $160,000.
In March 2023, Joseph Arthurs, the principal owner of VGN Enterprise Corporation (VGN), an asbestos removal company based in Patchogue, applied for a workers’ compensation insurance policy from Wesco Insurance Company for coverage from April 2023 through April 2024, as required by New York State law. Arthurs allegedly 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.
Based on this application, the insurance company issued a workers’ compensation policy for VGN with an annual premium of $4,203.
In September 2024, an investigation by the Offices of the New York State Inspector General determined that Arthurs had allegedly obtained a New York State Department of Labor Asbestos License/Certification and filed multiple “Asbestos Project Notifications” with the agency.
As alleged, 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. The investigation also determined that VGN had 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 $163,561.00 in insurance premiums on its workers’ compensation insurance policy.
Arthurs was placed under arrest on August 25, 2026, and as required by law, a desk appearance ticket was issued.
On September 9, 2026, Arthurs and VGN were arraigned before District Court Judge Alonzo G. Jacobs, on charges of Penalties for Fraudulent Practices, a Class E felony, and Effect of Failure to Secure Compensation, a Class E felony.
“Underrepresenting employees on workers’ compensation insurance means undercutting their safety,” said Suffolk County District Attorney Ray Tierney. “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.”
“New Yorkers who are hurt on the job deserve a workers’ compensation system they can rely on,” said New York State Workers’ Compensation Fraud Inspector General Lucy Lang. “Thank you to District Attorney Tierney and both of our teams for pursuing accountability for employers who put that vital protection at risk.”
Jacobs ordered Arthurs released on his own recognizance. The charges are not bail-eligible under current New York State law.
Their next court date for Arthurs and VN is September 21, 2026.