On August 7, 2026, San Francisco contractors Declan McKevitt and Grace McKevitt were arraigned on felony charges that expose one of the most damaging patterns in the construction industry: construction payroll fraud workers compensation criminal charges that leave injured employees without the coverage they are legally owed. The case against the owners of An Dun Construction is not only a criminal prosecution — it is a stark illustration of how employer fraud directly translates into real, measurable harm to workers who suffer serious injuries on the job.
The An Dun Construction Case: What Prosecutors Allege
Declan McKevitt and Grace McKevitt own and manage An Dun Construction, a San Francisco-based contracting firm. According to prosecutors, the couple allegedly fraudulently underreported payroll figures to their workers compensation insurer and failed to pay insurance premiums, income tax, and payroll tax — a multi-layered scheme that simultaneously defrauded their insurer, the state, and their own employees. The August 7, 2026 arraignment marks the formal beginning of criminal proceedings, with both defendants scheduled to return to court on October 15, 2026.
Payroll underreporting in workers compensation is not a victimless accounting error. When a contractor falsifies payroll figures, the insurer calculates premiums based on artificially low risk exposure. This means that if a worker is injured, the insurer may have grounds to dispute coverage — and critically, the employer has created a fraudulent paper trail that can be used to deny that an injured worker was even legitimately employed. According to the U.S. Bureau of Labor Statistics Injury, Illness, and Fatalities program, construction consistently ranks among the highest-risk industries for serious workplace injuries, making adequate workers compensation coverage a matter of life and limb, not just regulatory compliance.
A Severed Finger, a Denial, and a Four-Month Wait
The most alarming element of the An Dun Construction case is what allegedly happened after an employee was severely injured on a table saw in August 2026, resulting in an amputated finger. Rather than facilitating the worker’s compensation claim, Declan McKevitt allegedly instructed the injured employee to deny that the injury was work-related. McKevitt further claimed that the worker was employed at the jobsite without his knowledge — essentially asserting the injured man was an unauthorized trespasser rather than an employee.
This false denial caused a four-month delay in the payment of benefits to the injured worker. A finger amputation is a catastrophic, life-altering injury that typically requires emergency surgery, reconstructive procedures, occupational therapy, and long-term rehabilitation. Every month of delayed benefits is a month without income replacement, medical coverage, or the legal protections workers compensation is specifically designed to provide. This is the direct human cost of construction payroll fraud workers compensation criminal charges — fraud does not stay in accounting ledgers; it reaches into hospital rooms and kitchen tables.
For workers navigating serious injury claims that involve employer misconduct or outright denial, understanding what compensation may be available is critical. A personal injury settlement calculator can help injured workers develop a preliminary understanding of damages before consulting with a legal professional.
How Construction Payroll Fraud Works — and Why It Harms Injured Workers
The mechanics of payroll fraud in the workers compensation system are well-documented by regulators and prosecutors. Employers pay workers compensation premiums as a percentage of total payroll, adjusted by the risk classification of the work being performed. Construction carries some of the highest risk classifications — and therefore some of the highest premiums — in the entire premium schedule. By underreporting payroll, a contractor can dramatically reduce its premium obligations while still operating at full capacity with uncovered workers.
When an injury occurs under these fraudulent conditions, employers face a secondary problem: the underreported worker may not appear in payroll records at all, or may appear as working fewer hours in a lower-risk classification. This creates a ready-made mechanism for claim denial. As seen in the An Dun Construction case, the employer can then claim the injured worker was not a legitimate employee — a tactic that prosecutors in 2026 are increasingly treating not just as a civil dispute but as criminal fraud. California law imposes felony liability for workers compensation fraud under California Insurance Code Section 1871.4, which covers fraudulent statements made to deny or delay compensation to an injured worker.
The Dual Criminal Liability Framework in California
The An Dun Construction prosecution is notable for the breadth of the alleged criminal conduct. This is not solely a workers compensation fraud case — it also encompasses alleged failure to pay income tax and payroll tax, creating dual criminal liability under both insurance fraud and tax fraud statutes. Employers who engage in construction payroll fraud workers compensation criminal charges often face compounding charges because the same falsified payroll records used to underpay insurance premiums are also used to underreport tax obligations.
California prosecutors have increasingly pursued construction payroll fraud as a serious felony rather than a regulatory matter. This approach mirrors a national trend: in August 2026, Florida authorities announced charges in connection with a $100 million workers compensation fraud ring — one of the largest such prosecutions in that state’s history — underscoring that law enforcement at every level is escalating its response to systematic employer fraud in the construction sector.
Statistics: The Scale of Workers Compensation Fraud in Construction
The An Dun Construction case is not an isolated incident. The following table reflects the documented scope of workers compensation fraud and construction industry injury data relevant to 2026 enforcement priorities.
| Metric | Figure | Source |
|---|---|---|
| Construction industry fatal work injury rate (2024, most recent) | 9.6 per 100,000 full-time equivalent workers | U.S. Bureau of Labor Statistics |
| Estimated annual cost of workers compensation fraud (U.S.) | $9 billion or more per year | Insurance Information Institute |
| Percentage of workers comp fraud attributed to employer premium fraud | Approximately 30% of all workers comp fraud cases | Insurance Information Institute |
| Average workers compensation claim cost — hand/finger amputation | Among the top 10 most expensive injury categories | National Safety Council / BLS |
| California workers compensation fraud convictions (annual average) | Hundreds of cases prosecuted annually statewide | California Department of Insurance |
According to the Insurance Information Institute, workers compensation fraud costs the U.S. economy billions of dollars annually, with employer-side premium fraud representing a substantial share of the problem. These are not abstract losses — they translate directly into underfunded insurance pools, higher premiums for law-abiding employers, and most critically, denied or delayed benefits for injured workers.
What Injured Workers Should Know If Their Employer Commits Fraud
The An Dun Construction case raises urgent questions for any construction worker who has been told their injury was not work-related, that they were not officially employed, or that they must deny the circumstances of an accident. These tactics — which prosecutors allege were used against the table saw amputation victim — are not just unethical. In California and most other states, employer instructions to deny or misrepresent a work injury can constitute criminal fraud and create significant additional civil liability for the employer.
Workers who experience these tactics should understand several key legal protections. Under California law, an employer’s bad faith denial of a legitimate workers compensation claim can result in penalties far beyond the original benefit amount. The construction payroll fraud workers compensation criminal charges filed against the McKevitts demonstrate that prosecutors treat the denial tactic as part of the underlying fraud scheme — not a separate civil matter. Workers subjected to this kind of employer misconduct may also have independent civil claims beyond the workers compensation system, depending on the specific facts of their case.
In the most severe cases — where employer fraud or misconduct causes catastrophic outcomes — families may also need to evaluate additional legal options. When serious head trauma occurs in construction accidents, for example, a brain injury calculator can help estimate the full scope of damages, including long-term care costs, lost earning capacity, and non-economic harm.
Steps Workers Should Take When Facing Employer Claim Denial
- Document everything immediately: Photographs of the injury site, witnesses, and the circumstances of the accident create a factual record the employer cannot easily contradict later.
- Report the injury in writing: Even if an employer discourages a formal report, injured workers should submit written notice of the injury and retain a copy.
- Seek independent medical evaluation: Do not rely solely on employer-designated physicians when an employer has incentives to minimize or deny your injury.
- Contact California’s Division of Workers Compensation: The California Division of Workers Compensation provides resources for workers whose claims are disputed or denied, including information on filing complaints against fraudulent employers.
- Preserve records of lost income and medical expenses: A four-month benefits delay, as alleged in the An Dun Construction case, can create substantial documented harm that strengthens both criminal and civil proceedings.
What Happens Next: October 15, 2026 Court Date and Broader Implications
Both Declan McKevitt and Grace McKevitt are scheduled to return to court on October 15, 2026. The case will be closely watched by workers compensation regulators, insurance industry fraud investigators, and labor advocates throughout California. The prosecution’s approach — charging the denial of an injured worker’s claim as part of the underlying felony fraud scheme rather than treating it as a separate civil matter — could set important precedent for how construction payroll fraud workers compensation criminal charges are structured in future California cases.
The An Dun Construction case also arrives at a moment of heightened national scrutiny of employer-side workers compensation fraud. The pattern is consistent: contractors underreport payroll to reduce premium obligations, creating a structural incentive to deny injured worker claims when accidents occur, because legitimate claims expose the fraudulent payroll records. Prosecutors and regulators in 2026 are increasingly treating this entire cycle as a single criminal enterprise rather than a series of separate violations.
For injured construction workers throughout California and the country, the message of the An Dun Construction prosecution is clear: construction payroll fraud workers compensation criminal charges are being pursued aggressively, and the tactics used to deny legitimate claims — including instructing workers to lie about their injuries — carry serious criminal consequences for employers who attempt them. Workers who have been subjected to these tactics are not without recourse, and law enforcement is paying attention.
Frequently Asked Questions
What is construction payroll fraud in the context of workers compensation?
Construction payroll fraud in workers compensation occurs when an employer deliberately underreports the number of employees, the hours worked, or the total wages paid to their workers compensation insurer. Because insurers calculate premiums based on payroll and job risk classifications, underreporting allows the employer to pay artificially low premiums while leaving workers without adequate coverage. This practice is a felony in California and many other states. In the An Dun Construction case, prosecutors allege that Declan McKevitt and Grace McKevitt systematically underreported payroll, failed to pay insurance premiums, and also failed to pay income and payroll taxes — illustrating how construction payroll fraud workers compensation criminal charges often encompass multiple overlapping violations.
Can an employer be criminally charged for telling an injured worker to deny that an injury was work-related?
Yes. In California, making a fraudulent statement to deny, delay, or reduce workers compensation benefits to an injured employee is a felony under California Insurance Code Section 1871.4. In the An Dun Construction prosecution, Declan McKevitt allegedly instructed an employee who suffered a finger amputation to deny the injury was work-related and further claimed the employee was at the worksite without authorization. Prosecutors have incorporated this denial tactic as part of the overall construction payroll fraud workers compensation criminal charges, demonstrating that courts and prosecutors treat the denial of legitimate claims as criminal conduct, not merely a civil dispute.
What can a worker do if their workers compensation claim is denied because the employer claims they were not an employee?
Workers who face claim denial based on an employer’s assertion that they were not a legitimate employee have several avenues available. They should document all evidence of their employment, including text messages, pay stubs, photographs of work performed, and witness statements from coworkers. The California Division of Workers Compensation allows workers to file disputes and complaints when claims are improperly denied. Additionally, when employer fraud is involved — as alleged in the An Dun Construction case — state prosecutors and insurance fraud investigators may pursue criminal charges against the employer. A four-month delay in benefits, as occurred in that case, constitutes documented harm that supports both criminal prosecution and potential civil penalties against the employer.
What penalties do employers face for construction payroll fraud and workers compensation fraud in California?
California employers convicted of workers compensation fraud can face felony charges carrying potential prison sentences, substantial fines, restitution orders, and permanent disqualification from holding contractors’ licenses. When payroll fraud is combined with tax fraud — as alleged against Declan McKevitt and Grace McKevitt of An Dun Construction — defendants can face compounding charges under both California Insurance Code and tax statutes, significantly increasing potential penalties. Civil penalties may also apply, including enhanced benefit awards to injured workers whose claims were fraudulently denied. The construction payroll fraud workers compensation criminal charges filed in the An Dun Construction case reflect California’s increasingly aggressive approach to these schemes in 2026.
How common is employer payroll fraud in the construction workers compensation system?
Employer premium fraud, including payroll underreporting, is estimated to account for approximately 30% of all workers compensation fraud cases nationally, according to the Insurance Information Institute, and costs the system billions of dollars annually. Construction is one of the highest-risk industries for this type of fraud because the risk classifications and associated premiums are among the highest in the workers compensation system, giving contractors a strong financial incentive to falsify payroll records. In 2026 alone, major fraud prosecutions have been announced in California and Florida, reflecting a national enforcement trend. Workers in the construction industry are disproportionately harmed by this fraud because they are most likely to suffer serious injuries and most dependent on reliable workers compensation coverage when accidents occur.
Legal disclaimer: This article is for informational purposes only and does not constitute legal advice; readers should consult a licensed attorney regarding their specific legal situation.
David Prescott is a Workers Rights and Injury Specialist with extensive knowledge of personal injury law and settlement values across the United States. With years of experience analyzing workplace injury claims only cases, David helps injury victims understand their legal rights and the potential value of their claims. David is not an attorney and the information provided is for educational purposes only.