Carbone’s Bar owner pleads no contest to charges of insurance fraud.

Here's one way to get a cheaper rate for workers' compensation coverage: have fewer employees who need coverage. A problem with that strategy is when a business owner lies about having fewer employees to get a good deal on insurance.

For the year of August 2014-2015, Sal Carbone, the owner of a popular bar in New Monterey named after him, told his workers’ compensation carrier that he was the sole employee of the bar. Four years later, he admitted to lying about it.

In October of this year, Carbone, 58, was charged with a misdemeanor; a month later, on Nov. 14, Carbone pleaded no contest and was sentenced to 40 days in county jail and three years probation.

According to Monterey County Deputy District Attorney John Hubanks, Carbone should be eligible for a work alternative program in lieu of doing jail time. Pending completion of probation, a fine of $10,000 will be suspended.

Since 2007, Carbone has owned and operated two Monterey businesses: Sal’s Alley Side Café and Carbone’s Bar, both at 214 Lighthouse Ave. In June 2017, the Monterey County District Attorney’s Workers’ Compensation Fraud Unit was tipped off that Carbone had claimed having no additional employees other than himself to State Compensation Insurance Fund.

During the investigation, according to the DA's office, business and payroll records, as well as interviews with Carbone, his employees and accountant showed that he had misrepresented his payroll in order to obtain a lower insurance premium from SCIF.