Why Fraud Control Is Critical in Investigating and Eliminating Fraudulent Claims

A Message Employers Can Send Employees

When communicating with employees make it clear the company immediately investigates each accident when it occurs to determine the root cause and to identify corrective measures. And, will be on the alert for both minor extensions of days out of work and outright fraudulent claims. (From: Workers’ Comp Kit Blog, April 2009. Review the 25 “Red Flags” of Fraud on our blog).

What Happens When Fraud is Committed? Is It Worth It?*
Case One:
A man claimed he hurt his arm lifting sheet rock was taken arrested for allegedly returning to work while he collected workers’ compensation benefits from a state fund and charged with felony fraud for violating WC Law. It is claimed he received workers’ compensation payments for an injury to his upper right arm he said he suffered while working as a drywall installer. It is alleged the suspect performed a variety of jobs including drywall, painting and carpentry while receiving $2,450 in workers’ compensation benefits following the injury.

Case Two:
A claimant collected permanent disability for an injury (workersxzcompxzkit) said to include total loss of use of his right arm and both legs due to Reflex Sympathetic Dystrophy (RSD). A workers’ compensation attorney referred the settlement to the special investigations for review after the claimant submitted an application for a lump sum settlement in the amount of $617,000. The investigation revealed the claimant had use of both his legs and his right arm.

The man pleaded guilty to one count of workers’ compensation fraud, a third degree felony and one count of theft, a fourth degree felony. He was sentenced and as part of the plea agreement, he agreed to repay $23,536.92 in restitution and $7,000 in investigative costs.

The judge ordered him to pay at least $500 per month to BWC and or face incarceration for six years if he fails to pay. He was also sentenced to five years of community control.
*Extracted from original cases. Names and places omitted for privacy. These cases are a generic representation of what happens when fraud is committed in workers’ compensation claims.

Author: Dave Thomas is editor of Daily Insurer Blog. Dave has kindly granted permission to make use of information from his blog site pertaining to worker’s compensation issues. Thank you, Dave. Visit him at http://dailyinsurer.blogspot.com/ for more information on the articles appearing here.
Click on these links to try it for yourself.
WC Calculator www.ReduceYourWorkersComp.com/calculator.php
TD Calculator www.ReduceYourWorkersComp.com/transitional-duty-cost-calculator.php
WC 101 www.ReduceYourWorkersComp.com/workers_comp.php

Do not use this information without independent verification. All state laws are different. Consult with your corporate legal counsel before implementing any cost containment programs.