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 - January 12, 2012
Former Texas Pain Management Physician and Psychiatrist Sentenced To Federal Prison (TX) - Anthony Francis Valdez, a former physician who was the owner of the Institute of Pain Management, has been sentenced to 25 years in federal prison in connection with an estimated $42 million fraudulent health care benefit program billing scheme. Valdez was also ordered to pay $13,356,645.44 restitution, forfeit more than $1.7 million in cash, his residence in El Paso, his residence in San Antonio, and five vehicles. Beginning in January 2005 and continuing through December 2009, Valdez caused fraudulent claims to be submitted to Medicare, Medicaid, and TRICARE for procedures that he did not perform or were non-reimbursable. Read more
Unlicensed Contractor Sent to Jail On Fraud Charges (CA) - Sergio Gayton Gonzales has been sentenced to three months in jail as a result of his failure to pay $68,000 in workers' compensation insurance premiums. Gonzales used his son's contractor's license in order to bid on work as a subcontractor, but he failed to obtain and pay for workers' compensation insurance for his employees. Read more
Fraternal Order of Police Seek Investigation of Lieutenant's Job Application and Workers' Compensation Claims (FL) - The Fraternal Order of Police (FOP) union has requested that the City of Highland Beach and the Palm Beach County Inspector General's Office investigate whether Police Lt. Eric Lundberg lied on his job application when he said he had never been fired or forced to resign from a job. Lundberg had resigned from a position with the Monroe County Sheriff's Office after he was investigated concerning several workers' compensation claims he had filed. Read more
Moscow Bread Bakers May Be Shut Down (ID) - The Idaho State Industrial Commission has filed a complaint asking a court to issue an injunction to cease operations and impose a fine on the owner of the Panhandle Artisan Bread Co. for failing obtain workers' compensation insurance. Read more
Conviction and Prison Sentence of Shell Company Operator Affirmed By Federal Court (FL) - The United States Court of Appeals for the Eleventh Circuit has affirmed the conviction of Juan Rene Caro for conspiracy and filing false currency transaction reports and his sentence for 216 months in prison. Caro created fictitious or "shell" construction corporations to assist legitimate construction companies to avoid taxes and workers' compensation insurance costs by paying employees in cash that was not reported as wages. Read more - Click for Free Download of Court of Appeal Decision
Los Angeles Police Department Sergeant Arrested for Workers' Compensation Fraud (CA) - Sergeant Juan Fernandez, who has 24 years of service with the Los Angeles Police Department, has been arrested by investigators from the Department's Workers' Compensation Fraud Unit for workers' compensation insurance fraud. Fernandez was placed on leave from the police department on a workers' compensation claim on May 13, 2010, and did not return to work until March 27, 2011. An investigation revealed that Fernandez had submitted an altered doctors' note that allowed him to stay off work beyond the prescribed period and continue to receive compensation that he was not entitled too. Read more
Restaurant Owners Failed to Pay Their Employees Wages For Weeks (NY) - Hwan Kyun Kim and his wife Jeong Sook Lee, who owned and operated a Korean restaurant, New York Ban Jeom (formerly called Sol Bawoo Restaurant), have been charged with failing to pay wages and filing false tax returns in order to avoid unemployment insurance premiums. A chef allegedly worked for three months and did not receive any wages, and a waitress allegedly did not receive pay for several weeks. Read more
Postal Worker Sentenced To Prison For Workers' Compensation Fraud (CA) - Karina S. Beard has been sentenced to one year in prison, to be followed by three years of supervised release, on four counts of mail fraud and two counts of federal workers' compensation fraud. Beard worked as a distribution and window clerk for the postal service. For more than two years she received federal workers' compensation benefits for an on-the-job injury. Because of her claimed injuries, restrictions were placed on Beard's physical activities: no reaching, no pushing, no pulling, and no driving for more than 20 minutes. But Beard performed various physical tasks, such as horseback riding, caring for horses, yard work, and driving, all using the purportedly injured part of her body. Read more
Doctor Pleads Guilty In Pill Mill Case (OH) - Dr. Han M. Yang has pled guilty to six counts of trafficking in prescription drugs, a count of engaging in a pattern of corrupt activity, and a count of theft by deception related to health care fraud, as part of a pill mill investigation into prescription drug abuse, medical fraud, and money laundering. Read more
Self-Employed Gardner Charged With Double-Dipping (CA) - Andres Gonzalez has been charged with two felony counts of workers' compensation fraud for allegedly lying about the extent of his injuries. Gonzalez reportedly sustained an industrial injury while working for a local business. After filing a workers' compensation claim and subsequently receiving benefits, he misrepresented his abilities to work and to perform certain tasks. Investigators found evidence that Gonzalez had failed to report that he was working as a self-employed gardener while receiving his workers' compensation benefits. Read more
Roofing Company and Owners Plead Guilty To Fraud (MA) - Shaun Bryan and Antoinette Capurso-Bryan and their company, Newton Contracting Company, Inc., have pled guilty and been sentenced on charges that they failed to disclose millions of dollars in misclassified subcontractor payroll and failed to pay the prevailing wage. Newton Contracting misclassified as many as one-half of its employees as independent contractors, and during the company's annual worker's compensation audits, Shaun Bryan failed to disclose to the auditor more than $3.4 million of Newton Contracting's misclassified subcontractor payroll over the course of four policy periods. Read more
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