Rubbed the Wrong Way


According to the National Council on Compensation Insurance (NCCI), Alaska has the unfortunate honor of having some of the highest medical costs in the U.S., which also translates into the highest workers’ compensation premium costs in the nation. (The higher the medical bills, the higher the premium charged to businesses who want to protect their employees when on-the-job injuries occur.) One of the reasons that premiums are high is fraud. A former Fox, Alaska Department of Transportation and Public Facilities (DOTPF) employee contributed to some of those exorbitant insurance premiums by committing workers’ compensation fraud. (You could say that he rubbed his employer and their insurer, not to mention the state government, the wrong way.)

Here’s how the story goes. The former DOTPF employee, who was a weigh station operator, incurred an injury in 1999. Weigh station operators are responsible for making sure that trucks are not overloaded with freight and meet all state and federal requirements for getting back on the road. (Perhaps he injured himself while lifting a heavy piece of freight, or maybe while inspecting cargo, something heavy fell on him.)

The injured man moved to Wisconsin about three years later, settling his workers’ compensation claim with the State of Alaska in 2008 for $201,500. (Alaska also agreed to pay for future medical treatment.) The former DOTPF employee used some of the state benefits for massage therapy. Over the next three years, the man and his masseuse submitted fraudulent workers’ compensation claims for services he did not receive from the masseuse. (He also submitted mile reimbursement claims related to the massage treatments.) Apparently, the Alaskan received payment for more than $20,000 worth of massages. (Who wouldn’t love to receive that many massages?)

Both the supposedly injured worker and his masseuse were charged with 93 counts of perjury, theft and falsification of business records. The man was found guilty by an Anchorage jury of workers’ compensation fraud. The masseuse pled guilty to workers’ compensation fraud, testifying against the injured Alaskan during his trial. The terms of her plea agreement require her to pay $20,391.46 in restitution to the State of Alaska for the massage treatments she did not perform.

The former Alaska Department of Transportation worker, who committed workers’ compensation fraud, is partly responsible for driving up the costs of insurance and medical care for everyone. When sentenced this fall, he will face a possible sentence of up to a decade in prison and a fine of up to $100,000 plus restitution to the State for charges related to the scheme to defraud. For the theft and falsification of business records charges, he could get another five years behind bars, a fine of up to $50,000 and restitution to the State of Alaska. According to the article, he apparently did not show any remorse. (He may regret that when the judge delivers his final sentence. It’s too bad that he rubbed the government the wrong way, because it’s a given that the government has now cut off his massage allowance.)

Today’s “Fraud of the Day” is based on an article entitled, Former Alaska DOT worker charged with workers’ comp fraud,” published by Anchorage Daily News on May 20, 2013.

A former Alaska Department of Transportation worker and his supposed masseuse were charged with defrauding the State of Alaska out of more than $20,000 of worker’s compensation benefits, the state Department of Law said Monday.

Scott A. Groom and Laurayne K. Fischer, both currently living in Wisconsin, were charged with 93 counts including perjury, theft and falsification of business records.

Groom was an operator at a state DOT weigh station in Fox when he was injured on the job in 1999, according to the Department of Law. In 2008 he settled a worker’s compensation claim with the state for $201,500. The state agreed to pay for medical treatment as part of the settlement.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.