Alarre Partners
Thomas E. Brown
Don Ciaccio
Core Employer Services
Coverlink
EOS Health
Horizons PEO
Steve Landin
Michael McCafferty
Josh Poole
Pyramid Staffing Services
Regency Insurance of the West Indies
Richard Standridge
Peter Thosteson
TMG Staffing Services
Transpacific International Insurance Com
TTC Illinois

Action Date: July 25, 2007
Location: Jacksonville, FL

On July 25, 2007, Peter A. Thosteson pled guilty in federal court in Jacksonville, Florida, to conspiracy to commit wire fraud, for his role in a workers' compensation insurance fraud scheme which spread through many states in 2001 and 2002. Thosteson was a licensed insurance agent in Dothan, Alabama. He was president of TMG Staffing Services Inc. and Alarre Partners Inc., professional employer organizations based in Dothan. TMG had a branch office in Tampa. According to a Criminal Information filed in this case, TMG and Alarre contracted with various companies in Tampa, Orlando, Georgia, Alabama and Tennessee to provide human resources services, including the purchase and administration of workers compensation insurance. In a plea agreement Thosteson made in the case, he admitted to using the two companies to provide illegal and fraudulent workers compensation insurance to those client companies and the client companies' employees between March 2002 and May 2004 through Regency Insurance of the West Indies Ltd. and Transpacific International Insurance Co. Ltd. Neither company had ever been authorized to write insurance in any state. As part of the scheme, the defendants used company names similar to genuine insurance companies. Thosteson collected more than $4.8 million paid by client companies through premium payments for the insurance. As part of his plea agreement, Thosteson agreed to pay a $4 million fine and make full restitution to his victims. Thomas E. Brown, one of the principals of Regency and Transpacific, pled guilty in August, 2006, to conspiracy and wire fraud and is awaiting sentencing. Thomas D. King, the owner of another employee leasing company, MiraLink, was convicted in September, 2006, of mail fraud, wire fraud and money laundering and sentenced to 14 years in prison. Other employee leasing companies involved in the scheme included TTC Illinois, Pyramid Staffing Services, Core Employer Services and five companies which operated as The Orion Group. Andrew Dyndul of Pyramid, Colton Coile and Michael McCafferty of TTC Illinois previously pled guilty in the scheme. McCafferty was sentenced to 33 months. Dyndul and Coile are scheduled for sentencing. In June, 2007, Edgar Rawls of Core Employer Services, Don Ciaccio of TTC Illinois and Steve Landin of Coverlink were also charged in the scheme. Rawls is expected to enter a guilty plea on August 8, 2007. Many of the companies involved in the scheme also have had large federal tax liens filed against them, totalling over $20 million. Others who have pled Not Guilty in this scheme include Dr. Richard Standridge of EOS Health, a Third-Party Administrator in Phoenix, Arizona; Robert Jennings, of TPA One and Interstate Administrative Services, TPAs in Illinois, and Josh Poole of Horizons PEO in Atlanta, Georgia. All of these cases have been prosecuted by the United States Attorney's Office in Jacksonville, Florida following a joint investigation by the FBI and the Florida Division of Insurance Fraud.