Bellflower Firm Charged with Fraud

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In one of the largest fraud cases of its kind, two executives of a Bellflower staffing company have been charged with defrauding the State Workers’ Compensation Insurance Fund out of $18 million.

David Tai, 66, of Hacienda Heights and David Zahler, 52, of Huntington Beach, have been charged with conspiring to defraud the quasi public workers’ compensation insurer of last resort. Zahler was chief executive of Bellflower-based Staffing Services Inc., a temporary staffing company with thousands of employees; Tai was chief financial officer.

The office of Insurance Commissioner Steve Poizner, which conducted a two-and-a-half-year investigation of the company, said Monday that Staffing Services misrepresented the status of its employees to State Fund. That resulted in the company paying about $18 million less in insurance premiums than they should have over a three-year period, according to a press release issued by the state Department of Insurance.

Zahler and Tai each face up to 20 years in prison and up to $40 million in fines if convicted. The Los Angeles District Attorney’s office is prosecuting the case.

Attempts to reach Staffing Services Inc. were not successful.

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Howard Fine
Howard Fine is a 23-year veteran of the Los Angeles Business Journal. He covers stories pertaining to healthcare, biomedicine, energy, engineering, construction, and infrastructure. He has won several awards, including Best Body of Work for a single reporter from the Alliance of Area Business Publishers and Distinguished Journalist of the Year from the Society of Professional Journalists.

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