In essence, worker’s compensation fraud is a form of insurance fraud. This crime is committed when someone knowingly provides false or fabricated information to obtain some benefit or advantage these individuals would not have been entitled without the false information. It is also committed when someone knowingly denies the grant of a benefit due an individual entitled to its receipt.

The crime covers the following individuals:

• Direct and active participation in the alleged scheme;
• Aiding and abetting others in its commission;
• Soliciting others to participate in its commission;
• Conspiring with others in its commission;

to collect insurance benefits fraudulently. Thus, worker’s compensation fraud that covers many acts such as the following:

• Making a false or fraudulent claim for payment of a health care benefit;
• Submitting a claim for a health care benefit which was not used by or on behalf of the injured worker;
• Presenting multiple claims for payment of the same health care benefit;
• Payment of less than what is deserved for a particular health care benefit;

In specific acts, these are what are done by applicant-employees:

• Faking an injury or claiming for a non-work injury as a work related injury;
• Failure to disclose a prior injury or deny filing of previous claims;
• Collection of benefits for the same injury from more than one employer;
• Illegally working while receiving workers’ compensation benefits;

In specific acts, these are what are done by applicant-employers:
• Misrepresentation about the number of employees in the company;
• Misrepresentation of employee’s duties to avoid liability;
• Retaliation or threats to fire or punish an employee who applies for workers’ compensation benefits;
• No coverage as to workers’ compensation insurance;

The prosecution as either a misdemeanor or felony offense depends upon the factual circumstances of the case. If the amount of the alleged fraud is $950 or less, then the crime would be prosecuted as a misdemeanor with penalties of up to six (6) months in county jail and payment of fines of up to $1,000.

If the amount is above $950, the crime can be prosecuted as either a felony or misdemeanor. If it is a misdemeanor offense, then the imposable penalty would be twelve (12) months in jail and payment of fines up to $10,000. If it is above $950 and the charge is prosecuted as a felony, the imposable penalties would be between two (2) to five (5) years in state prison and payment of a fine of up to $150,000 or double the amount defrauded, whichever is higher.

In addition, the other penalties would be revocation or suspension of any California professional license, ineligibility to receive or retain benefits, restitution of benefits paid and publication of conviction for five (5) years in the California Department of Insurance’s website.

The crime of worker’s compensation fraud is a serious matter in California. Should you be or know anyone facing any of these charges, do reach out to the lawyers at the Law Offices of Ramiro J. Lluis for a free consultation today.