Each week we'll be surveying what the media, state agencies, insurance companies, and others report in terms of workers' comp fraud. Just like a police blotter, our workers' comp fraud blotter lists recent arrests, charges, convictions and investigations.
Workers' Comp Fraud Blotter - November 29, 2012
Tree Service Business Owner Pleads Guilty To Workers' Compensation Fraud (MA) - Edward App has pled guilty to failing to accurately report his total payroll or number of employees to his insurance provider in order to avoid paying the proper workers' compensation insurance premium. App was the owner and sole proprietor of App Tree Inc., a tree service company. An investigation was conducted after an employee was injured in a life threatening accident when he was crushed by a falling tree. Contrary to reports made to his insurance provider, App employed at least two full-time employees and a number of sporadic part-time workers at various times between 2005 and 2009. As a result of this scheme, App underpaid his workers' compensation insurer a total of $39,236 in premium payments. Additionally, the insurer paid more than $700,000 in medical and disability payments to the injured employee. Read more
Disabled State Employee Going To Jail For Using Sledge Hammer and Crow Bar (ME) - Clinton J. Ashby III has been sentenced to 30 days in jail and ordered to repay $8,687 in fraudulent workers' compensation benefits as a result of his conviction of workers' compensation fraud for lying to his doctors and his employer about his ability to work so that he could collect disability benefits because of a neck injury. Surveillance videos showed Ashby swinging a sledge hammer, using a crow bar, and running heavy equipment. Read more
Roofing Company Owners Coming Down From the Roofs For House Arrest (CA) - John Applegate and Camille Applegate, the owners of Hallmark Roofing, Inc., have been sentenced to eight months of house arrest and participation in a sheriff's work program as a result of their no contest pleas to workers' compensation fraud and tax evasion. The California Department of Insurance conducted a forensic audit of their business, which revealed that by failing to report the business's employee wages accurately, Hallmark Roofing's owners avoided paying $629,391.10 in workers' compensation insurance. They have made restitution of $200,000 so far. Read more
Three Indicted For Workers' Compensation Fraud (OH) - Frederick Diebert and Michelle Skaggs have been indicted on two counts of workers' compensation fraud. Christopher Brisbin has been indicted on four counts of tampering with records and one count of workers' compensation fraud. Read more
Contractor Heading To Jail For Violations (CA) - Secundino Munoz, who operated Munoz Landscaping, has been sentenced to 180 days in the county jail for failing to acquire workers' compensation insurance and fraudulently using a contractor's license. Read more
Police Officer Lied About Her Back Injury (NY) - Camille Bishop, a former New Paltz police officer, has pled guilty to attempted workers' compensation fraud. After becoming an officer, Bishop filed a claim for workers' compensation disability, stating that she had injured her back while moving a tree that had fallen on a road. At the time of the claim, as well as when she was hired, Bishop had denied having any prior back injury, even though she had been treated three years earlier for a back injury after an automobile accident. Read more
Drywall Couple Continued To Work After Claiming They Were Disabled (WA) - Jamie S. Beroth, and her husband, Lawrence J. Beroth, the owners of Beroth Drywall, have been charged with one count of felony theft each for collecting workers' compensation benefits illegally. For over two years, each of them collected benefits while claiming that they were unable to work because of alleged injuries. While receiving benefits, Jamie continued to work at Beroth Drywall, actually preparing and submitting her husband's injury paperwork, and video surveillance showed Lawrence working at his drywall business, submitting bids, purchasing and hauling supplies, and preparing for and working the drywall jobs he received. Read more
Insurance Broker Sentenced To 135 Months In Prison For Bribery, Kickback, Fraud And Perjury Scheme (NJ) - Francis X. Gartland, the former insurance broker for the Toms River Regional School District, has been sentenced to 135 months in prison for his role in a scheme to pay bribes and other benefits to the former superintendent of schools to get and maintain a contract to provide insurance services for the district. Gartland and others created a scheme with the former superintendent to approve a workers' compensation insurance contract between Gartland and the school district in which the contract fee would yield $500,000 to $600,000 per year in excess fees, which would be used to pay bribes and kickbacks to the superintendent. Read more
Former Safety Manager At TVA Nuclear Sites Convicted of Hiding Injuries To Obtain Safety Bonuses (TN) - A federal jury has convicted Walter Cardin, the safety manager for the Shaw Group at three TVA nuclear power plants, of eight counts of major fraud against the United States. Cardin was convicted of generating false injury rates that were used by the Shaw Group to collect safety bonuses worth over $2.5 million from TVA. The jury heard evidence of over 80 injuries, including broken bones, torn ligaments, hernias, lacerations, and shoulder, back, and knee injuries that were not properly recorded by Cardin. Read more
Equipment Operator Indicted for Double-Double-Double-Dipping (TX) - Corey Lee has been indicted by a state grand jury on workers' compensation fraud charges that allege that he unlawfully received $3,956 in workers' compensation benefits. Lee reported a job-related injury while working as an equipment operator for Gainesville Personnel Solutions and claimed that he was unable to work. His employer's insurer, though, discovered that he continued to work for three other companies while receiving benefits. Read more
President Of Construction Company Pleads Guilty To Providing False Workers' Compensation Data (NJ) - Herlindo Garcia-Merlos, the president of Orients Construction Company, Inc. and Melrose Construction, Inc., has pled guilty to two counts of second-degree theft by deception. Garcia-Merlos admitted that between February 2007 and April 2010, he provided false and misleading information to NJM Insurance Group by falsifying the type of services rendered by Orients as well as the amount of payroll during the specified policy periods. As a result of the fraud, Garcia-Merlos obtained reduced workers' compensation premiums of $315,680. Read more
Surveillance Video Exposes Workers' Compensation Fraud By Lawn Care Business Owner (OH) - Michael Dickerson has pled guilty to workers' compensation fraud after video surveillance showed him working at his lawn care business while he was receiving permanent total disability benefits. Dickerson was seen using a push mower, riding mower, leaf blower and weed trimmer at residential, retail and church properties while receiving benefits. He also asked some of his customers to pay him in casgh so that his work could not be traced. Read more
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