Eric Goldstein, the owner and operator of GT Systems, was arrested and charged with insurance fraud, forgery, offering a false instrument for filing and fraudulent practices under New York State’s worker compensation law, for fraudulently underpaying approximately $25 million in premiums.
Goldstein operated 50 temporary staffing companies under GT Systems, which due to the employment size are required to hold workers’ compensation insurance through New York State Insurance Fund (NYSIF). However after 2000, NYSIF cancelled Goldstein’s policy for not paying their premiums.
Between 2003 and 2007, Goldstein allegedly falsified employee applications to NYSIF to deny any connections with GT Systems and Goldstein.
When Goldstein refused to allow audits of GT Systems’ companies’ payroll by NYSIF, NYSIF raised the companies’ premiums, to which Goldstein refused to pay. Goldstein purportedly cancelled these policies and opened a new company by lying about its relations to Goldstein to keep the premiums low.
If convicted, Goldstein faces a maximum penalty of 48 years in prison.