The owners of Belmont-based Hallmark Roofing were granted a continuance on sentencing Tuesday in San Mateo County Superior Court by Judge Mark Forcum.
On July 31, 2012, John and Camille Applegate pleaded nolo contendre (no contest) to eight felony counts stemming from insurance and workers' compensation premium fraud.
San Mateo County District Attorney Steve Wagstaffe said the Applegates made a motion to continue the sentencing because their home is currently in escrow, telling the judge they will use the proceeds from the sale of the home to pay the restitution to the State State Compensation Insurance Fund and Employment Development Department.
"Judge Forcum granted the defense motion to continue and reset the case for both defendants to Oct. 24, 2012 9:00 a.m. for imposition of sentence and for restitution hearing," said Wagstaffe in an email.
The maximum sentence promised by the court was three years imprisonment; the district attorney has requested seven years imprisonment.
The Applegates are former spouses who remained business partners in their company, Hallmark Roofing. for allegedly failing to report employee wages and not paying workers' compensation premiums from 2007-2011.
A forensic audit by the state Department of Insurance determined the Applegates did not pay hundreds of thousands of dollars in insurance premiums, allowing their company to make lower bids on projects than their competitors.
The couple also failed to file tax returns in both 2010 and 2011, according to the District Attorney’s Office. If convicted, they could each face up to five years in prison each and fines in excess of $1 million, according to the state Department of Insurance.
The defendants are out of custody on $50,000 bail bond.
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