Workers’ Compensation Fraud Issues That Can Lead To Litigation

January 22, 2016
Sacks & Zolonz, LLP
Workers’ Compensation Fraud

When it comes to workers’ compensation, California company owners will likely face legal issues at some time. Not only do they have to work through the insurance-related legal requirements for businesses, but they may also have to deal will fraudulent workers’ injury claims from time to time. The insurance system in another state reported that convictions were obtained for nine individuals who committed workers compensation fraud.

Some of those convicted included several business owners whose workers’ compensation insurance policies had lapsed — one as long ago as 1994. Others had failed to obtain insurance to cover employee injuries, falsely classifying their workers as contractors or subcontractors to avoid paying insurance premiums. Although workers in such circumstances might be awarded benefits, the compensation system will seek to recover those funds from the employer.

A guilty plea was entered by a man who was working at his company for two years while he claimed to be disabled and received temporary total disability benefits. Another man ran a handyman business while also receiving temporary total disability benefits. This apparently continued for five years, and he also pleaded guilty. One of the convictions involved a young man who took advantage of the benefits offered to enrolled students at accredited educational institutions. The proof of enrollment made him eligible for coverage up to age 25; however, investigators found that he never attended classes.

California business owners typically have many responsibilities, and retaining the services of an experienced workers compensation attorney to handle insurance-related issues may allow them to attend to other important aspects of their businesses. A lawyer who is knowledgeable concerning workers’ compensation laws and the comp system might save the company substantial amounts of money. Not only will the attorney know the tell-tale signs of workers’ compensation fraud by employees, but he or she can also work to ensure the company is in compliance with workers’ compensation laws.

Source:, “Nine convicted in workers’ comp fraud investigations“, Caitlin Bronson, Jan. 19, 2016

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