Workers' Comp Fraud Blotter (8/2/2012) – Arrests Made In “Operation Dirty Money” Check Cashing Scheme

Workers' Comp Fraud Blotter (8/2/2012) – Arrests Made In “Operation Dirty Money” Check Cashing Scheme

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 - August 2, 2012

Arrests Made In "Operation Dirty Money" Workers' Comp Fraud Check Cashing Scheme (FL) - The Workers' Compensation Fraud Task Force, operated jointly by the Florida Department of Financial Services' Division of Insurance Fraud and the Broward Sheriff's Office, has charged eight individuals with workers' compensation fraud and money laundering for their involvement in a large-scale check cashing scheme to evade the cost of workers' compensation coverage. Hugo Rodriguez, the owner of the Oto Group, Inc., is the alleged the ring leader of seven individuals and the facilitator of 10 known shell companies that have funneled in excess of $70 million in undeclared and undetected payroll through different money service businesses.  Nilbala and Kanti Patel, the owners of K & N Food Corp., a licensed money service business that was used by Rodriguez and his associates, are set to enter into plea agreements with authorities and have agreed to the immediate forfeiture of over $490,000 in illicit proceeds.   Read more

Disability Claimant Who Could Not Pick Up a Can of Dr. Pepper Was Able To Pull Weeds and Move Furniture (FL) - Cecilia Marmolegos has been charged with workers' compensation fraud  for allegedly collecting $4,600 in fraudulent benefits. Marmolegos stated that she was injured when a patient grabbed her while she was working as a certified nursing assistant. She claimed that her injury progressed to the point that she could not lift a can of soda. But a detective observed her loading a sectional couch in her SVU and pulling weeds in her yard.   Read more

Tree Trimmer Owner Cut Corners To Underpay Workers' Compensation Insurance Premiums (MA) - Edward App, the owner of App Tree Inc., a tree service company, has been charged with workers' compensation fraud and larceny. App reported to his insurer that he was the sole employee of the company and failed to disclose any information about additional employees in order to obtain the minimum premium rate on his policy. After an employee was injured in a life threatening accident when he was crushed by a falling tree, it was determined that App allegedly employed at least two full-time employees and a number of sporadic part-time workers at various times between 2005 and 2009, thus underpaying his premiums by $42,115.   Read more

Data Cross Match Nets Workers' Compensation Fraud Conviction For Double-Dipping (OH) - Renee Washington has pled guilty to felony worker's compensation fraud and has been ordered to make restitution as a result of a cross match of data shared by the Ohio Bureau of Workers' Compensation and the Ohio Department of Job and Family Services. The data cross match revealed that Washington was working as a part-time home health aide with A-1 Nursing Care while also receiving temporary total disability and living maintenance benefits.   Read more

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