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Husband and wife sentenced for fraud scheme through their drywall firm

The Annandale pair bilked an insurance company out of more than $300,000.
Author:
Drywall

A husband and wife who committed insurance fraud worth more than $300,000 through their drywall company have been sentenced.

LeRoy Mehr, 51, and Joyce Mehr, 50, pleaded guilty to theft by swindle on Oct. 8, and on Monday were sentenced to 180 days of electronic home monitoring, and must complete 30 days of community service.

They were each fined $30,000, and must repay their insurance provider, Federated Insurance, more than $309,000 in lost workplace compensation insurance premiums.

They will each be placed on probation for five years.

The pair intentionally classified certain workers as sub-contractors to avoid having to pay workers compensation insurance premiums, causing the $309,000 loss to Federated Insurance during the 12-month period between April 2016 and 2017.

When they were charged in January, Hennepin County Attorney Mike Freeman said the fraud in this instance was on a level "we rarely see."

"It cheats workers from the healthcare insurance they're entitled to, it cheats insurance companies who are supposed to provide the coverage, and thirdly it cheats companies who compete with the fraudulent corporation, because they can bid cheaper or take more money home," Freeman said.

During a remote sentencing, the Mehrs apologized, and told Judge Regina Chu: "It will never happen again."

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