Workers’ Compensation Fraud Doesn’t Pay

10269592 - injured male hand with upper part of body. hand is bandaged with red plaster focus set on thumb

Every once in a while, employees are injured on the job. Sometimes, the injuries result from a particular incident, such as a box in a store room falling on an employee’s foot. Other times, the cause may be more subtle, like an injury resulting from a repetitive hand or wrist motion like typing. In either case, workers’ compensation insurance is there to help employees who are injured on the job with expenses resulting from loss of wages or medical bills. Unfortunately, some people, like the woman in today’s fraud from the Visalia Times-Delta, cheat the system by lying about their injuries.

The article reports that the woman was convicted following a two-day trial on two charges of workers’ compensation fraud for filing false claims in 2007 and 2010. The woman, who worked as an office technician at a California substance abuse treatment center first filed a claim ”alleging she suffered a wrist injury while processing inmates’ mail.’? When she filled out her questionnaire, she said she couldn’t write, type and ”described her pain as ‘excruciating.”’ She received treatment and returned to work. Here’s the catch…while she wasn’t working, she took college classes and worked two days a week as a student nurse at a medical center. She was also captured on video at the time ”loading heavy textbooks into her car, texting on her cellphone, taking out the trash and carrying heavy grocery bags.’? (So much for the wrist injury.? She also posted nearly 200 updates on a social networking site. (Guess she had to update her social network on what she was doing while defrauding the system.)

After two years, she returned to her job at the treatment center. She worked just 10 hours in two days before filing a second claim for workers’ compensation, this time ”alleging injury to her neck and shoulder after lifting a binder.”

Her fraud in both cases totaled $11,000. (Looks like her wrist didn’t hurt enough to keep her from cashing checks.)

Now convicted of fraud, she faces sentencing in May, where she faces up to five years in prison time and $150,000 in fines.

In California, when people cheat the system, they are cheating the California companies, which fund the workers’ compensation insurance system. And it is important to remember, that it is just that? an insurance program. As with all insurance programs, when people cheat the system, California companies aren’t the only ones who lose money; the other victims are the individuals who really need the help due to a real work-related injury.

So, here’s the question for the day? how does your state’s workers’ compensation agency catch fraudsters?

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”Tulare Woman Could Get Five Years for Workman’s Compensation Fraud,” written by Luis Hernandez and published by the Visalia Times-Delta on May 1, 2012.

A Tulare woman convicted last week of worker’s compensation fraud could be sentenced to five years in prison and ordered to pay $150,000 in fines when she returns to court later this month.

Kristi Denise Motty, 34, was convicted Thursday on charges that she lied when she filed two claims — one in 2007 and another in 2010. According to the Tulare County District Attorney’s Office, the fraud Motty is linked to is estimated at $11,000.

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Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.