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CFO Atwater Announces Arrests of Two Miami-Dade County Residents for $35 Million in Fraudulent Transactions in ‘Operation Dirty Money’ Scheme

4/15/2013

Contact: CFO Atwater’s Press Office 
(850) 413-2842

TALLAHASSEE – Florida Chief Financial Officer Jeff Atwater today announced the arrests of John Diaz, 45, Pinecrest, for money laundering, organized scheme to defraud (first-degree felonies), multiple money service business violations (second-degree felonies), and two counts of workers’ compensation fraud (both third-degree felonies) and Mercedes Avila-Diaz, 44, Pinecrest, for two counts of workers’ compensation fraud (both third-degree felonies).

A Workers’ Compensation Fraud Task Force investigation revealed that a total of $35 million in fraudulent transactions occurred at Diaz Supermarkets, a licensed money service business, owned and operated by Diaz since 2006. As a result of the search warrants executed in Miami-Dade County at four Diaz Supermarkets locations and one administrative office, a total of $640,000 was seized in forfeiture along with three vehicles.

The investigation also revealed that Diaz and Avila-Diaz jointly owned and operated Diavila Enterprises, Inc., which was advertised as a tax preparation company, since 2003. This company had been operating for nearly 10 years without the required workers’ compensation coverage, a third-degree felony.

Diaz and Avila-Diaz collectively face up to 95 years in prison if convicted on all counts. The Miami-Dade County State Attorney’s office will be prosecuting this case.

The Office of Financial Regulation assisted the task force by providing financial data support and licensure information and has played an integral part in helping the task force put these criminals behind bars. The Miami-Dade County Police Department also assisted with arrests.

The Workers’ Compensation Fraud Task Force includes CFO Atwater’s Division of Insurance Fraud, the Broward Sheriff’s Office and the Palm Beach County Sheriff’s Office. Through joint efforts, the task force has been able to successfully shut down more than 30 shell companies and identify $335 million in fraudulent transactions associated with these companies.

Anyone with information about these or any other incidents of suspected insurance fraud is asked to call 1-800-378-0445.
Citizens who provide tips can remain anonymous. The Department of Financial Services to date has awarded almost $275,000 to more than 40 citizens as part of its Anti-Fraud Reward Program. The program rewards individuals up to $25,000 for information that directly leads to an arrest and conviction in an insurance fraud scheme.

Chief Financial Officer Jeff Atwater, a statewide elected official, oversees the Department of Financial Services. CFO Atwater’s priorities include fighting financial fraud, abuse and waste in government, reducing government spending and regulatory burdens that chase away businesses, and providing transparency and accountability in spending.