Workers' Comp Fraud Blotter (12/26/2012) – Security Firm CEO Who Guarded the Statue of Liberty Convicted of Fraud

Workers' Comp Fraud Blotter (12/26/2012) – Security Firm CEO Who Guarded the Statue of Liberty Convicted of Fraud

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 26, 2012

Security Firm CEO Who Guarded the Statue of Liberty Convicted of Fraud (CA) - Ousama "Sam" Karawia, the former president and chief executive of International Services Inc., has been convicted of grand theft of labor and insurance fraud for hiding the size of his firm in order to reduce his workers' compensation insurance premiums. Karawia's firm provided security for government facilities, including the downtown Los Angeles County Courthouse and the Statue of Liberty in New York, and he was also a Los Angeles County Sheriff's Department reserve deputy.   Read more

Employee Tried To Use Workers' Compensation For Paid Vacation (OH) - Eric Harris has pled guilty to a misdemeanor count of workers' compensation fraud for filing a false claim. Harris informed his employer he was taking an extended vacation and asked to be laid off in order to collect unemployment benefits as the company did not have paid vacation leave. When the employer refused, he then stated that he would file a workplace injury claim to collect benefits. Harris did file a claim indicating that he had been injured in a work related incident, but the employer's payroll records revealed that Harris was not working on the alleged date of the injury.   Read more

Las Vegas Police Officer Relieved Of Duty Following Arrest For Fraud (NV) - Officer John A. Wilson has been placed on unpaid administrative leave following his arrest on felony charges involving fraudulent workers' compensation activities. Wilson had been a police officer for 16 years and was currently assigned to the traffic bureau.   Read more

Business Owner Reported Zero Payroll For Family Members Working For Him (OH) - Christopher Wilson, dba Fostoria Monument Company LLC, has pled guilty to one misdemeanor count of attempted workers' compensation fraud for underreporting payroll. Investigators received an allegation from an auditor that payroll reports filed by Fostoria Monument Company LLC did not include payroll for employees. Wilson claimed that he had attended a local conference on workers' compensation and was advised that the payroll for family members did not need to be reported.   Read more

High Heels and Romance In  the Park Lead To Nine Months in Jail (CA) - Modupe Adunni Martin has been sentenced to nine months in jail as a result of her plea of no contest to workers' compensation fraud for faking an injury in order to collect benefits. Martin claimed that she could not work as a result of an ankle injury that she sustained while working as a school custodian. She subsequently made ten visits to her doctor using crutches, but she was often recorded on video walking without them after leaving the doctor's office. On one occasion, she was taped throwing her crutches in her car, changing into high heels, and then meeting her boyfriend in a park for a romantic encounter.   Read more

Café Owner Paid For Workers' Compensation Coverage With Bad Checks (OH) - Helen Huntington, dba Helen's Sunrise Café Inc., has pled guilty to misdemeanor counts of attempted passing of bad checks and attempted workers' compensation fraud. Huntington allowed her policy to lapse and remitted a dishonored payment for coverage. She was given 10 days to rectify the dishonored payment and advised that she needed to submit outstanding payroll reports and either pay the resulting premiums or enter into a payment plan in order to reinstate her policy. Huntington failed to either rectify the bad payment or have her worker's compensation coverage reinstated.   Read more

Painting Contractor To Pay Back Wages After Classifying Employees As Independent Contractors On Weekends (FL) - Clark Cooper Painting LLC has agreed to pay $45,983 in back wages to 26 painters because the employees were misclassified as independent contractors on weekends. As a result, employees were paid "straight-time" rates for all hours worked, including weekends, instead of time and one-half their regular rates for hours worked beyond 40 in a workweek. The misclassification of employees as independent contractors presents a serious problem, including substantial losses for state unemployment and workers' compensation funds.   Read more

Disabled Dad Worked For Daughter As an Electrician (OH) - William Bosstic has pled guilty to one misdemeanor count of workers' compensation fraud for working while receiving benefits. Bosstic worked as an active participant in his daughter's business, MRB Electric, while receiving Temporary Total benefits. He performed work in a supervisory capacity at times and also personally performed electrical work while receiving benefits.   Read more

Former Owners Of Temporary Employment Agency Lose Appeal Of Conviction For Payroll Fraud (MA) - The United States Court of Appeals for the First Circuit has affirmed the convictions of Michael Powers and John Mahan, the former owners of Commonwealth Temporary Services, for paying more than $25 million in unreported cash to their employees as part of a conspiracy to avoid paying $7 million in taxes and hundreds of thousands dollars in workers compensation insurance premiums. Commonwealth Temporary Services supplied hundreds of temporary laborers to businesses throughout Eastern Massachusetts, and Powers and Mahan lied to both the IRS and their insurers about the size of their payroll and paid the majority of their employees in cash in order to make their fraud more difficult to detect.   Read more

Parole's Scrapping Metal Leads to Order of Restitution (OH) - James Benvenuto has pled guilty to one felony count of workers' compensation fraud for failing to report wages. Investigator's received an allegation from Benvenuto's parole officer that he was scrapping metals to provide extra income while receiving workers' compensation benefits. Benvenuto was found to be self-employed scrapping metal while failing to report any of his wages. He has paid restitution of $16,475.93.   Read more

Contract Labor Business Owner Indicted For Workers' Compensation Fraud (TN) - Richard Nobles, who owns several subcontract labor companies including Xpress Services, Express Services, Labor Fast, Fast Track Systems, and CSI Services, Inc., all located at 5425 Elvis Presley Boulevard in Memphis, has been arrested on four counts of workers' compensation fraud over $60,000. Nobles' companies provided workers for various construction jobs, primarily for dry wall work, and he allegedly underreported the annual amount of payroll for his various companies with the intent to defraud four separate insurance companies of workers' compensation premiums that totaled more than $1 million dollars.   Read more

Store Employee Injured Himself When He Fell Off A Porch At Home (OH) - Ernest Harding has pled guilty to two misdemeanor counts of workers' compensation fraud for filing a false claim. Investigators received an allegation from his employer that Harding was not working on the date that he claimed he was injured on the job. Investigators learned that Harding entered the employer's store on the date of injury while off work and stole money. He then injured himself when he fell off a porch later that same day at home.   Read more

Sting Nets Arrest Of 10 Unlicensed Contractors (FL) - A multi-agency undercover operation has resulted in the identification and arrests of 10 individuals who were practicing as unlicensed contractors in Pinellas County. The sting operation targeted unlicensed contractors who advertised various types of home repair services that included roofing, AC repair, plumbing and electrical work. The unlicensed contractors, Michael David Morrison Jr., Eric Michael Pusateri, John Samuel Young, Nicholas Achilles Vaseliades, Lynnoid Damon Stewart, Robert Bhola Deonarine, Michael J. Perez, Juan J. Dones, Gamal Ibrahim Baker, and Randy Scott Carr,  were identified through advertisements listed on Craig's List, Angie's List and the Seminole Beacon.   Read more

Double Dipper Ordered To Maintain Viable Employment (OH) - Michael Paulsen has pled guilty to a felony count of workers' compensation fraud for working while receiving benefits. Paulsen was receiving wages from two businesses during periods when he was also receiving working wage loss benefits, and he knowingly failed to report his earnings. Paulsen was sentenced to six months of incarceration, suspended for one year of community control if he pays $11,554.87 in restitution, and he was ordered to maintain viable employment.   Read more

Claimant Lied About Incomprehensible Pain From Work Injury (OK) - Carolin Reinschmiedt, aka Carolyn Reinschmiedt, a health services provider, has been charged with allegedly filing a false workers' compensation insurance claim. Reinschmiedt submitted a claim alleging that she was injured while working for Woodland View Care and Rehabilitation Center when she hurt her left shoulder, back and neck while carrying a combative resident. Reinschmiedt made statements to numerous health care providers that her alleged pain was incomprehensible and that she was unable to do any activities and treatment provided no relief. However, while reviewing surveillance video, investigators observed Reinschmiedt shopping, getting in and out of a car, and lifting and carrying objects with no visible signs of discomfort.   Read more

Disabled Claimant Also Worked on Concrete Projects (OH) - Randall Willett has guilty to a felony count of workers' compensation fraud for working while receiving compensation. A claims service specialist alleged that Willett was operating a concrete business called Willett Concrete, working on various concrete and construction projects during periods he was receiving Temporary Total and Living Maintenance benefits. Willett's work trucks were visible at his residence and business location.   Read more

Disabled Employee Was Able To Work For Home Healthcare Agency (OH) - Joann Martin has pled guilty to one felony count of workers' compensation fraud for working while receiving benefits. Investigators received an allegation from an anonymous source stating that Martin was working for a home healthcare agency while receiving benefits. A review of employment records, bank records and client records and statements confirmed Martin was working while receiving benefits.   Read more

Lawn Care Owner Mowed Grass For Cash To Hide Work While Receiving Benefits (OH) - Michael Dickerson has pled guilty to one felony count of workers' compensation fraud for working while receiving benefits. An anonymous allegation claimed that Dickerson was operating a lawn care business while receiving workers' compensation benefits following a workplace injury, and that he was asking his customers to pay him in cash so his work could not be traced. Surveillance on multiple occasions showed Dickerson using a push mower, a riding mower, a leaf blower and a weed trimmer at residential, retail and church properties while he was receiving Permanent Total Disability.   Read more

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