A survey of what the media, state agencies, insurance companies, and others report in terms of workers’ comp fraud, listing recent arrests, charges, and convictions.
Criminal complaints and indictments are accusations only.
Defendants are presumed innocent until proven guilty.
1-A FORMER EMPLOYEE of the California Employment Development Department entered a guilty plea for committing fraud by approving her friend’s false disability claims. She approved claims amounting to over $110,000.
Trial evidence showed the woman entered false information into EDD computers between July 2003 and January 2006 to approve disability insurance benefits for claims submitted by friends. She paid a chiropractor to approve the disabilities and took a cut of the benefits
The 49 year old faces a possible maximum penalty of 20 years in federal prison and a $250,000 fine for mail fraud. However, the judge will review federal sentencing guidelines before setting sentence.
2-A MAN WHO collected benefits for five years based on a 2000 reopened work comp claim for low-back strain was charged with 57 counts of felony theft for allegedly collecting workers’ compensation benefits illegally, to which he pled not guilty. The worker claimed he was unable to work due to the earlier injury and that no other injuries had occurred in the meantime.
The Department of Labor & Industries (L&I) stopped benefit payments after an investigation determined that the worker suffered an unrelated injury in October 2003. At the time, he was self-employed and not paying for workers’ compensation insurance.
“The information from the public was vital to our investigation,” commented Carl Hammersburg, manager of L&I’s Fraud Prevention and Compliance Program. “Reporting your suspicions about fraud helps protect legitimate employers and their injured workers who really deserve benefits.”
Each felony count against carries a maximum penalty of 10 years in prison and a $20,000 fine and he can be ordered by the court to repay nearly $366,000 in illegally collected benefits.
Whatever the outcome of the criminal case, by stopping payments L&I avoids paying out an estimated $154,000 in benefits over the next two years if the claimant had remained on their rolls.
3- A CHIROPRACTOR and retired human relations manager allegedly conspired to commit workers’ comp fraud against three workers, according to Ed Hazel, a Monterey County managing deputy district attorney. The allegations date to November 2005. The doctor faces eight counts of fraud and the HR manager, seven. Each count carries a maximum 5-year prison sentence. (workersxzcompxzkit)
In addition, Carol Reed, a county deputy district attorney assigned to the case, said the HR manager is also in court proceedings on a separate case. In 2007 he was charged, along with a physician’s assistant and a superintendent of a cardboard box company with insurance fraud. They allegedly covered up employee injures to avoid paying workers’ compensation cost on businesses in Salinas.
Reposted with Permission: Visit LexisNexis for more information and full reports. http://law.lexisnexis.com/practiceareas/Workers-Compensation-Law-Blog/workers-compensation-fraud-/Workers-Comp-Fraud-Blotter-11132009—Recent-Arrests-Charges-Convictions–Investigations
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By: Private investigator with 25 years experience.
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