Los Angeles delivery company owners to repay more than $2 million after workers’ compensation scheme left employees unprotected
News: 2025 Press Release
LOS ANGELES — John Nemandoust, 70, and Annette Assil, 62, a Los Angeles couple, were sentenced after a California Department of Insurance investigation found they underreported more than $21 million in employee payroll for their delivery companies. Nemandoust was sentenced to 60 days in county jail, while Assil was sentenced to 30 days. The pair were sentenced to 10 years of felony probation and also ordered to pay $2,254,748 in restitution for unpaid workers’ compensation insurance premiums.
The Department launched an investigation into A-1 Valley Services, Prompt Delivery, and Affordable Messenger, the three companies the couple owned, after receiving information that two of the companies were uninsured. The investigation revealed that between 2013 and 2017, the couple only obtained workers’ compensation coverage for Valley Services employees, while leaving Prompt Delivery and Affordable Messenger uninsured.
When employees from the uninsured companies sustained work-related injuries, they fraudulently filed claims under Valley Services’ policy, concealing the lack of coverage and misclassifying their workforce. Over the four-year period, at least 20 uninsured employees had claims improperly filed under Valley Services’ policy.
A forensic audit found that the companies' combined gross payroll exceeded $25 million, while they only reported approximately $1.4 million to their insurance carrier—resulting in the $21 million payroll underreporting. This scheme allowed the couple to avoid paying approximately $3 million in workers’ compensation insurance premiums.
“By misleading their insurance carriers, these business owners created an unfair advantage over their competitors and put their employees at risk,” said California Insurance Commissioner Ricardo Lara. “This sentence ensures they are held accountable and must repay the stolen premiums.”
The Los Angeles County District Attorney’s Office prosecuted the case.
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Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at www.insurance.ca.gov via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.
