§ 52. Effect of failure to secure compensation. 1. (a) Failure to
secure the payment of compensation for five or less employees within a
twelve month period shall constitute a misdemeanor, and is punishable by
a fine of not less than one thousand nor more than five thousand
dollars. Failure to secure the payment of compensation for more than
five employees within a twelve month period shall constitute a class E
felony, and is punishable by a fine of not less than five thousand
dollars nor more than fifty thousand dollars in addition to any other
penalties otherwise provided by law. It shall be an affirmative defense
to any criminal prosecution under this section that the employer took
reasonable steps to secure compensation.

(b) Where any person has previously been convicted of a failure to
secure the payment of compensation within the preceding five years, upon
conviction for a subsequent violation such person shall be guilty of a
class D felony, and fined not less than ten thousand nor more than fifty
thousand dollars in addition to any other penalties including fines
otherwise provided by law.

(c) Where the employer is a corporation, the president, secretary and
treasurer thereof shall be liable for failure to secure the payment of
compensation under this section. It shall be an affirmative defense to
any action against any officer of a corporation under this section that
the officer took reasonable steps to ensure that the corporation secured
compensation, that proper internal procedures were in effect to do so,
and that proper internal controls existed to monitor compliance with
said procedures.

(d) If at any time an employer intentionally and materially
understates or conceals payroll, or intentionally and materially
misrepresents or conceals employee duties so as to avoid proper
classification for calculation of premium paid to secure compensation,
or intentionally and materially misrepresents or conceals information
pertinent to the calculation of premium paid to secure compensation,
such employer shall be deemed to have failed to secure compensation and
shall be subject to the sanctions applicable to this section.

(e) A stop-work order issued because an employer is deemed to have
failed to secure compensation under section one hundred forty-one-a of
this chapter shall have no effect upon an employer's or carrier's duty
to provide benefits under this chapter or upon any of the employer's or
carrier's rights and defenses.

2. All fines imposed under this chapter, except as herein otherwise
provided, shall be paid directly and immediately by the officer
collecting the same to the chairman, and shall be paid by him into the
uninsured employers' fund created under section twenty-six-a of this
chapter, provided, however, that all such fines collected by justices of
towns and villages shall be paid to the state comptroller in accordance
with the provisions of section twenty-seven of the town law and section
4-410 of the village law respectively.

3. In any prosecution hereunder the failure of the employer to file
with the chairman, within ten days after demand, a statement subscribed
by the employer and affirmed by him as true under the penalties of
perjury showing specifically (a) the name of the stock company, mutual
corporation or reciprocal insurer in which such employer is insured and
the number and the date of issuance and term of such policy of
insurance, or (b) that the said employer is insured with the state fund
in which case he shall give the number of such policy of insurance, the
date of issuance and term thereof, or (c) that the said employer has
been authorized to do business as a self-insurer pursuant to section
fifty of this article, giving the date of said authorization, or (d) a
legal reason, if any, why said employer is not required to secure
compensation, shall constitute prima facie evidence that the employer
has failed to secure compensation as herein required. The statement to
be filed herein shall be subscribed by the employer or if the employer
is a corporation by one of the officers herein named in which he shall
state that he has read such statement subscribed by him and knows the
contents thereof and that same is true of his own knowledge.

4. If, however, there has been an accident and the board shall have
made an award against the employer as a non-insured employer, the making
of such award, except in a case where the employer had secured
compensation insurance which was in effect at the time of the accident
but the carrier later became insolvent, shall constitute prima facie
evidence of an employment by the employer of an employee in an
occupation in which the said employer was required to carry compensation
and of the failure of the employer to secure the payment of workers'
compensation on the date of the accident involved in said award. A
certified copy of such award shall be received as competent evidence of
the making thereof in any criminal prosecution hereunder.

5. The chair, upon finding that an employer has failed for a period of
not less than ten consecutive days to make the provision for payment of
compensation required by section fifty of this article, may impose upon
such employer, in addition to all other penalties, fines or assessments
provided for in this chapter, a penalty of up to two thousand dollars
for each ten day period of non-compliance or a sum not in excess of two
times the cost of compensation for its payroll for the period of such
failure, which sum shall be paid into the uninsured employers' fund
created under section twenty-six-a of this chapter. When an employer
fails to provide business records sufficient to enable the chair to
determine the employer's payroll for the period requested for the
calculation of the penalty provided in this section, the imputed weekly
payroll for each employee, corporate officer, sole proprietor, or
partner shall be the New York state average weekly wage, multiplied by
1.5. Where the employer is a corporation, the president, secretary and
treasurer thereof shall be liable for the penalty. If the employer shall
within thirty days after notice of the imposition of a penalty by the
chair pursuant to this subdivision make an application in affidavit form
for a redetermination review of such penalty the chair shall make a
decision in writing on the issues raised on such application.