Remember the Irvine fellow who was accused of stealing $2.7 million worth of wine from the storage lockers of his son's business?
George Osumi II, 65, pleaded guilty Friday to the embezzlement as well as under-reporting more than $3.5 million in payroll to his workers' compensation insurance carrier for his various businesses and was sentenced to six years in state prison.
Scott Osumi, the son of the defendant and president of Legend Cellars of Irvine, employed his father at the business that kept clients' wine in temperature-controlled lockers. Three times between Jan. 1, 2008, and June 21, 2012, George Osumi II broke into the private storage of three different clients and stole their wine that had a total estimated value of $2.7 million. Osumi replaced the bottles of wine he stole with much cheaper brands.
A friend of Osumi's, who did not know the wine was stolen, auctioned off some of the wine in exchange for a portion of the proceeds. Osumi wound up depositing $280,000 from those sales. Osumi also directly auctioned stolen wine himself for more than $300,000.
A statement from the Orange County District Attorney's office indicates a family member of one of the clients reported the theft to the Irvine Police Department, but Scott Osumi's attorney previously told the Weekly it was his client who turned his father in.
George Osumi II's arrest led to a far-ranging investigation into various businesses he owned. According to the OCDA statement:
Between December 2001 and March 2006, Osumi committed workers' compensation insurance premium fraud after he reported his payroll to SCIF [State Compensation Insurance Fund] at just over $1 million. He actually maintained a payroll of over $4.5 million, a difference of over $3.5 million from his reporting to SCIF. This resulted in a loss of over $814,000 in premium owed to SCIF.
Between May 2004 and October 2011, Osumi obtained an American Express Card under the name of one of his former business associates and made unauthorized purchases.
On April 2011, Osumi committed perjury under the California Contractors State License Board (CSLB) contract code after he declared and stated as true a material matter he knew was false under penalty of perjury that he did not operate a business which required workers' compensation insurance.
Between 2009 and 2011, Osumi withheld state taxes and disability insurance benefits payments from his employees and failed to forward these withholdings to the State or filing payroll reports with EDD [Economic Development Department]. Osumi filed false reports, which did not contain the identity of all of his employees. Consequently, when two of his employees filed a claim with EDD to collect unemployment benefits, EDD had no record of their employment and these employees had to provide proof of their employment. Osumi distributed paychecks with insufficient funds to employees, despite him operating a business that earned income.
For the Legend Cellars crimes, Osumi copped Friday to three felony counts of second degree commercial burglary, one felony count each of grand theft, embezzlement by employee, receiving stolen property, and one misdemeanor count for possession of burglary tools with sentencing enhancements for aggravated white collar crime over $500,000 property damage over $1.3 million, and crime-bail-crime.
For the other crimes, he pleaded guilty to 18 felony counts of misrepresenting facts to (SCIF), 14 felony counts of failing to file a return with intent to evade tax, 14 felony counts of willful failure to pay tax, 14 felony counts of willful failure to pay unemployment insurance and employment training tax, nine felony counts of willful failure to pay disability insurance deductions, one felony count of identity theft, and one felony count of perjury. He faces sentencing enhancement allegations for misrepresenting facts to SCIF, committing an aggravated white collar crime over $500,000, property damage over $65,000, and crime-bail-crime.
The courts are not done with Osumi, who is scheduled to face a restitution hearing Nov. 1 in Santa Ana.