TRENTON – Acting Attorney General John J. Hoffman announced that the president of a roofing company pleaded guilty today to providing false and misleading information to the company’s workers’ compensation insurance carrier in order to avoid paying hundreds of thousands of dollars in insurance premiums that he was obligated to pay.

Charles Kelcy Pegler Sr., 56, of Spring Lake, pleaded guilty to third-degree insurance fraud before Superior Court Judge Anthony J. Mellaci in Monmouth County. Pegler was charged in a Dec. 19, 2013 state grand jury indictment. 

Judge Mellaci scheduled sentencing for June 6. Under the plea agreement, the state will recommend that Pegler be sentenced to 180 days in county jail as a condition of five years of probation. Pegler previously paid full restitution to New Jersey Manufacturers Insurance Company. The plea agreement also requires Pegler to pay $134,087 to Atain Insurance Company.

“Employers have an obligation to provide full and adequate workers compensation insurance coverage for their employees,” Acting Attorney General Hoffman said.  “Because of criminals such as this defendant, honest, hard-working New Jerseyans are forced to pay increased premiums to cover the costs of the fraud.”  

“This conviction demonstrates that the Office of the Insurance Fraud Prosecutor stands ready and able to prosecute sophisticated schemes and influential executives, even those at the highest reaches of companies,” Acting Insurance Fraud Prosecutor Ronald Chillemi said.

Pegler was the president of Roof Diagnostics, Inc. (“RDI”), which was located at 2333 Highway 34 in Wall.  During the time of the alleged crime, RDI was located at 608 Brighton Avenue in Spring Lake Heights. RDI employs approximately 400 people. In pleading guilty, Pegler admitted that between June 11, 2003 and Oct. 5, 2009, he created the false impression to New Jersey Casualty Insurance Company, which is a subsidiary of New Jersey Manufacturers Insurance Company, that RDI was not a roofing company, that it did not employ roofers and that it did not install, maintain and/or repair roofs.  An investigation by the Office of the Insurance Fraud Prosecutor determined that, as a result of the alleged crime, RDI paid $265,044 less in workers’ compensation insurance premiums than it should have.

Pegler further admitted that between Jan. 15 and Dec. 9, 2009, he created the false impression to USF Insurance Company, now called Atain Insurance Company, that all roofing and re-roofing services offered by RDI were performed by subcontractors.  Through this fraud, Pegler avoided paying $134,087 in general liability insurance premiums which he owed to the insurance company.

Acting Insurance Fraud Prosecutor Chillemi, Deputy Attorneys General Michael Locke, Bradford Muller and Thomas Tresansky and Detective Natalie Brotherston coordinated the investigation.  Acting Insurance Fraud Prosecutor Chillemi represented the state at the guilty plea hearing. Additional investigative assistance was provided by Detective Taryn Kong and Detective Trainee Ryan Kirsh, Analysts Terry Worthington and Terri Drumm and Technical Assistant Ramona Navarro. Acting Insurance Fraud Prosecutor Chillemi thanked the New Jersey Department of Labor and Workforce Development, New Jersey Manufacturers Insurance Company and Atain Insurance Company for their assistance in the investigation.

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