“The Serial claimant”

Syzmon Nowak, age 50, was a cook at a famous San Diego diner.  After complaining to his boss about a leaky refrigerator, he subsequently slipped and fell on the wet floor, hurting his back.  Several people witnessed his fall.  He filed his work comp claim with my organization and his claim was quickly accepted.  It was a simple “soft tissue” back injury, but Syzmon’s subjective complaints of severe pain convinced his primary treating physician to keep him on Total Temporary Disability for several months after he should have been back to work.

The assigned claims adjuster alerted SIU to a red flag.  Syzman’s co-workers told the AOECOE investigator that Syzmon had been calling them to about a high quality dog food he was selling. Syzmon  even disclosed to his doctor that he had sold “a few bags” of dog food since his injury, but that he had not made more than a few dollars on it.  I investigated the dog food business, even calling the owner of the dog food company, but I couldn’t get any proof that Syzmon was selling dog food in any great quantities.  

I still felt there was more to investigate.  Syzmon’s injury was very minor.  There were no abnormal findings on X rays and MRIs.  Yet, he always said his pain was “9 out of 10, or worse”.  I noted in his medical reports that he disclosed only one prior back injury from a workers comp claim five years prior.  Otherwise, he stated, more than once, he had no other prior back injuries or insurance claims.

The claims adjuster and I searched ISO claim search for Syzmon Nowak and we found one workers comp back injury, five years prior to the current.  Just out of curiosity, we subpoenaed the claims file fr0m the other insurer.  When it arrived, we were surprised to see that Syzmon’s earlier claim was very similar to the current one.  He had been working as a cook, he complained to the manager about a leaky refrigerator and subsequently slipped on the wet floor, hurting his back in front of several witnesses.  

Also, in the prior claim, there was a mention of an even earlier back injury clam with yet another carrier.  I realized that ISO Claim search records only went back seven years and this third injury was nine years ago.  I called the adjuster contact on that earliest claim and heard a familiar story—Syzmon worked as a cook, he warned the manager about a leaky refrigerator, and subsequently slipped on the wet floor in front of three witnesses. 

To me, it looked like Syzmon had a habit of filing back injury claims, with identical facts.  The amazing thing was that he did actually fall on his back three times in front of witnesses.  He was committed to this scheme. 

I shared this info with Claims and Legal and they set Syzmon’s depo.  Syzmon recounted the accident at our insured.  Our attorney asked him about the injury five years ago, and Syzmon admitted to it, although he did not describe it happening the way it appeared in the subpoenaed records.  Finally, Syzmon denied any other back injuries or filing any other workers comp claims.

After the depo, we subpoenaed the records from the earliest claim.  We provided a copy of both prior injury files to Syzmon’s primary treating physician along with the depo transcript wherein Syzmon failed to disclose the earliest claim.  The physician was struck by the similarity of the three slip and fall injuries and he discharged Syzmon from care with no need for future medical or permanent disability. He also opined that Syzmon was never really TTD. 

I submitted my suspected fraud referral to the DA s office.  The key evidence was the depo transcript, the prior medical records and the final report from the current physician.  The DA filed multiple counts of felony insurance fraud against Syzmon.  Syzmon’s claimed that having immigrated from Poland thirty years earlier, he was not fluent in English.  Although he had never requested an interpreter for his medical appointments or in his deposition, he now insisted he needed a Polish language interpreter for the Superior Court hearings.  Such interpreters are not easy to find so several hearings had to be postponed.

During the investigation, I spoke with Syzmon and found he spoke English fluently.

However, the Criminal case went forward as a Bench Trial (no jury was present, only the judge). Syzmon was found guilty on all counts.  He was sentenced to one month in County Jail, three years probation, restitution and he had to agree to get his workers comp case dismissed with prejudice.

Syzmon later appealed the criminal conviction.  The higher court affirmed the lower courts ruling.

Hopefully,  Syzmon has found employment outside the restaurant industry.

 

 

 

 

“The Double Dipper”

Sarah Miller was a bookkeeper for a construction firm who filed a workers compensation claim due to work related carpal tunnel.  The insurance company accepted her claim and began paying her Temporary Disability (TD) benefits because her primary treating physician declared her “Totally Temporary Disability”.  However, the owner of the construction heard that Sarah was supposedly working for a travel agency while she was collecting her TD checks, so she called the assigned claims adjuster, who notified SIU of the red flag.

As the assigned SIU investigator, I reviewed Sarah’s Facebook account.  Sarah’s account was private, so very little info was available. I was able to see that Sarah had recently “checked in” at a local travel agency.  I reviewed the website for the Travel Agency and under “Contacts”, there was a phone number and email address for “Sarah Douglas” in the Accounts department. 

In my background research on Sarah Miller, I had noted that Miller was her married name.  Her maiden name was Douglas.  I drove by the Travel Agency during working hours and found Sarah Miller’s car parked in the lot.

In reviewing the medical reports in the Claims file, I saw that Sarah had denied working anywhere since her date of injury.  At the time, our company sent paper checks to claimants for their benefits.  Each TD check came with a letter advising the claimant that if they had resumed working during the time period they were being paid for, they needed to report it to their claims adjuster.  Sarah appeared to be working at the travel agency while receiving TD benefits and she had never disclosed it.

However, this did not feel like enough evidence to support a suspected fraud referral.  I did not have tangible evidence that Sarah was currently working for (and getting paid by) the travel agency.  Sarah had retained an applicant attorney so I spoke with the Claims adjuster and our assigned in house attorney about the case.  We decided to depose Sarah.

Our attorney did a very good job in the depo.  She asked Sarah “Have you worked anywhere since you stopped working for the construction” and
“Have you worked anywhere under your maiden name of “Douglas” since she was married three years prior.  Sarah Miller nee Douglas answered “No” to other questions.

After the depo, the claims adjuster subpoenaed Sarah Douglas’s employment file form the travel agency.  In those records, we found that Sarah Miler and Sarah Douglas had the same Date of Birth, social security and home address.  Sarah had worked part time for the travel agency while working for our insured full time.  When she went on TD benefits from her job with our insured, she began working full time for the travel agency.  Apparently, her carpal tunnel syndrome did not affect her ability to work for the travel agency.

I submitted my suspected fraud referral to law enforcement.  The key pieces of evidence were the depo transcript, the employment records from the travel agency, the medical reports and copies of cashed  TD checks equaling approx. $45,000.  The DA filed charges within six weeks of receiving the case. Sarah entered a guilty plea at the Preliminary hearing to two counts of Felony Insurance fraud and agreed to pay restitution, while on probation for three years.  Our Legal department successfully petitioned the Workers Comp Appeals Board to bar Sarah form receiving any further benefits related to her alleged injury.  

Next up--"The Serial Claimant"

 

The Five Most Common Workers Comp Claimant Fraud Scenarios—Part 1 of 5:

For insurance carriers who underwrite workers compensation policies, fraud is a constant risk.  Claimant (or Injured Worker), Premium and Provider fraud are the “big three” in workers compensation fraud.

Premium fraud often involves multi-million dollar schemes where an insurance company misrepresents their payroll and operations in order to avoid paying the true cost of their insurance.  Medical and Legal Provider cases often attract significant medica coverage and impact hundreds or thousands of injured worker claim files.

Claimant fraud, however, typically involves losses under $50,000 and don’t usually attract media attention unless the claimant was a public sector worker, such as a law enforcement officer.  These cases can be difficult to difficult to prosecute because claimants sometimes evoke sympathy from juries.  Often, there is some legitimacy to the injury but the claimant made a material misrepresentation regarding the benefits, which makes the suspected fraud harder to articulate.

On the other hand, Claimant fraud is much more “personal” to the policyholder/employer.  Small business owners, in particular, feel extreme frustration when they perceive fraud is being committed by someone they hired.  They took a chance on someone and may get rewarded with larger insurance premiums.  The cost of workers compensation insurance is often a large item in a company’s finances. 

I have been investigating workers compensation fraud for over seventeen years.  Many of my suspected fraud referrals have led to charges filed by District Attorneys in Los Angeles, Orange, Riverside, Ventura, Imperial and San Diego Counties. I have learned from these law enforcement officers that true workers comp Claimant fraud cases tend to fall into one of five scenarios.  I will provide examples of each scenario, referencing actual cases, with the names changed.                              

“The Double Dipper”

Sarah Miller was a bookkeeper for a construction firm who filed a workers compensation claim due to work related carpal tunnel.  The insurance company accepted her claim and began paying her Temporary Disability (TD) benefits because her primary treating physician declared her “Totally Temporary Disability”.  However, the owner of the construction heard that Sarah was supposedly working for a travel agency while she was collecting her TD checks, so she called the assigned claims adjuster, who notified SIU of the red flag.

As the assigned SIU investigator, I reviewed Sarah’s Facebook account.  Sarah’s account was private, so very little info was available. I was able to see that Sarah had recently “checked in” at a local travel agency.  I reviewed the website for the Travel Agency and under “Contacts”, there was a phone number and email address for “Sarah Douglas” in the Accounts department. 

In my background research on Sarah Miller, I had noted that Miller was her married name.  Her maiden name was Douglas.  I drove by the Travel Agency during working hours and found Sarah Miller’s car parked in the lot.

In reviewing the medical reports in the Claims file, I saw that Sarah had denied working anywhere since her date of injury.  At the time, our company sent paper checks to claimants for their benefits.  Each TD check came with a letter advising the claimant that if they had resumed working during the time period they were being paid for, they needed to report it to their claims adjuster.  Sarah appeared to be working at the travel agency while receiving TD benefits and she had never disclosed it.

However, this did not feel like enough evidence to support a suspected frau referral.  I did not have tangible evidence that Sarah was currently working for (and getting paid by) the travel agency.  Sarah had retained an applicant attorney so I spoke with the Claims adjuster and our assigned in house attorney about the case.  We decided to depose Sarah.

Our attorney did a very good job in the depo.  She asked Sarah “Have you worked anywhere since you stopped working for the construction” and
“Have you worked anywhere under your maiden name of “Douglas” since she was married three years prior.  Sarah Miller nee Douglas answered “No” to bother questions.

After the depo, the claims adjuster subpoenaed Sarah Douglas’s employment file form the travel agency.  In those records, we found that Sarah Miler and Sarah Douglas had the same Date of Birth, social security and home address.  Sarah had worked part time for the travel agency while working for our insured full time.  When she went on TD benefits from her job with our insured, she began working full time for the travel agency.  Apparently, her carpal tunnel syndrome did not affect her ability to work for the travel agency.

I submitted my suspected fraud referral to law enforcement.  The key pieces of evidence were the depo transcript, the employment records from the travel agency, the medical reports and copies of cashed  TD checks equaling approx. $45,000.  The DA filed charges within six weeks of receiving the case. Sarah entered a guilty plea at the Preliminary hearing to two counts of Felony Insurance fraud and agreed to pay restitution, while on probation for three years.  Our Legal department successfully petitioned the Workers Comp Appeals Board to bar Sarah form receiving any further benefits related to her alleged injury. 

Next up--The Serial Claimant.