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 - December 6, 2012
Former Prison Guard Arrested For Lying About Disability Caused By Working With Rats (FL) - David Brownell, a former corrections officer at the Glades Correctional Institution, has been charged with first-degree workers' compensation fraud for allegedly faking a disability illness to fraudulently collect over $2.7 million in claims payments since 1995. Brownell claimed that his work at the correctional institution had exposed him to rats and rat feces, causing respiratory problems and 24-hour-a-day dependency on oxygen. Extensive video surveillance over a period of several years revealed that not only was Brownell not oxygen-dependant, but that he was able to play guitar in a band, attend a concert, drive, and smoke cigarettes. Read more
Frequent Skier Indicted For Workers' Compensation Fraud (CA) - A federal grand jury has returned an 11-count indictment against Mark E. Leung, charging him with wire fraud, mail fraud, and making a false statement to obtain federal workers' compensation. Leung, who left his job with the Post Office in 1987 because of a work-related injury, is alleged to have fraudulently claimed on his annual certification form that he could not perform any work due to the pain he suffered that limited his mobility and range of movement. While claiming that he was totally disabled from employment, though, Leung maintained a yearly ski pass for Heavenly Ski Resort in Lake Tahoe, where he regularly skied for at least 40 days per ski season, and he was also observed performing arduous physical labor on numerous days. Read more
Former County Risk Manager Charged With Paying Bogus Bills From Shell Company In Wife's Name (PA) - Garry Esworthy, the recently retired risk manager for Dauphin County, has been charged with theft by unlawful taking and unlawful use of a computer. He allegedly paid with county funds $490,000 in bogus invoices that were sent from a shell insurance company that he had created under his wife's name. For ten years, Esworthy had been in charge of overseeing and paying the county's liability and workers' compensation insurance policies. Read more
Shell Companies and Cash Payroll Send Dad and Son To Prison (CA) - Steven Morales has been sentenced to seven years in prison for workers' compensation fraud, tax fraud, and perjury. He and his son Brian, who has been sentenced to four years in prison, cheated more than 400 employees out of insurance premiums and defrauded their workers' compensation insurance carriers. Their companies, which supplied frame-up employees for construction sites, paid the employees with cash and through shell companies in order to avoid workers' compensation and unemployment expenses. Read more
Construction Contractor To Spend Weekends In Jail For Hiding Payroll From Insurers (TN) - Mike Nobles has been sentenced to probation, restitution, and a year of weekends in jail, after pleading guilty to workers' compensation fraud. Nobles worked on several large construction projects by offering general contractors cheap labor costs, which he was able to do because he concealed his true payroll costs from his workers' compensation insurers. Read more
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