Archive

Archive for October, 2012

Toledo business owner misclassified employees to lower worker’s comp bill

Limousine company’s competitor tipped off BWC

COLUMBUS – The owner of a Toledo (Lucas County) limousine company has been ordered to pay restitution to the Ohio Bureau of Workers’ Compensation (BWC) for misclassifying his employees and failing to maintain workers’ compensation insurance coverage.  Ibe Nnaji, owner of Toledo Livery Service, was sentenced in the Toledo Municipal Court last week after a suspicious competitor submitted an allegation of fraud to BWC’s Special Investigations Department (SID).

“As Mr. Nnaji learned, misclassifying employees and failing to maintain coverage can cause concern among competitors who take issue with any unfair advantage these actions may create,” said BWC Administrator/CEO Steve Buehrer. “If an employer provides the tools necessary for workers to complete their jobs and controls the work environment, they cannot claim those employees as subcontractors, and doing so purposely constitutes fraud.”

The case was referred by a local competitor who suspected Nnaji did not have valid BWC coverage. Nnaji did submit a portion of his outstanding payroll reports, but the SID’s Employer Fraud Team investigation revealed Nnaji began reporting his employees as subcontractors in 2003 after reporting them as employees for several years. Nnaji’s policy lapsed in November 2007. Nnaji was audited by BWC in 2008 and placed on notice that he was improperly reporting his drivers as subcontractors.  He was then billed the appropriate premiums.

Nnaji’s policy remained lapsed in 2009 and he was informed he could face criminal charges if he failed to reinstate/maintain coverage.  Nnaji did not comply and was charged in April 2010.  Nnaji finally submitted the remaining outstanding payroll reports after being charged, but again reported his drivers were subcontractors.   An additional BWC audit was conducted and auditors found that Nnaji was again improperly classifying his drivers.

Nnaji pleaded to a fourth degree charge of disorderly conduct October 17 after multiple pre-trial court appearances.  He was ordered to pay $13,612.92 in restitution and sentenced to 30 days in jail, suspended for five years of probation.

To report suspected workers’ compensation fraud, call 1-800-OHIOBWC, visit ohiobwc.com, or visit www.facebook.com/ohiobwcfraud.

Grove City man owes $30,000 for workers’ comp fraud

Keith Miller sentenced for falsifying paperwork

COLUMBUS – Keith Miller of Grove City (Franklin County) has been ordered to pay restitution to the Ohio Bureau of Workers’ Compensation (BWC) after he admitted to altering paperwork he submitted to request injured worker benefits.  Miller pleaded guilty in a Franklin County courtroom and must repay more than $30,000.  

Miller was receiving Living Maintenance Wage Loss, which is available to an injured worker who has completed a rehabilitation plan but continues to have physical restrictions and experiences a wage loss upon return to work.  BWC’s Special Investigations Department received an allegation in 2010 that the wage statements Miller submitted to request compensation appeared to be suspicious. The statements had conflicting work dates and appeared to have been altered.

Investigators interviewed Miller and his employer, and he ultimately admitted to altering the statement forms and submitting false payroll records in order to receive benefits.

“It can be frustrating for someone who can work following an injury but faces employment at a lower wage,” said BWC Administrator/CEO Steve Buehrer.  “Living Maintenance can help close that gap, but is clearly not justified if submitting false information is the only way to gain approval.” 

Miller pleaded guilty to one felony count of workers’ compensation fraud was sentenced to seven months in prison, suspended for a five-year period of community control. He was also ordered to pay $30,240.31 in restitution.

To report suspected workers’ compensation fraud, call 1-800-OHIOBWC, visit ohiobwc.com, or visit www.facebook.com/ohiobwcfraud.

BWC investigations result in eight workers’ comp fraud convictions in September

Columbus – Ohio Bureau of Workers’ Compensation (BWC) Administrator/CEO Steve Buehrer today announced eight individuals were convicted of or pleaded guilty to charges related to defrauding Ohio’s workers’ compensation system during September. The court actions are the result of investigations conducted by BWC’s special investigations department (SID). The department works to deter, detect, investigate and prosecute workers’ compensation fraud.

“These cases represent two common types of fraud cases we see: employers that don’t maintain the proper workers’ comp coverage and injured workers obtaining employment in conflict with their benefits,” said Buehrer.  “Regardless, Ohio employers and their workers should know that cases that involve any apparent fraud will be taken very seriously by our investigators – and perpetrators will be punished.”

A summary of the cases that resulted in a guilty plea or conviction during September follows.

Lisa Hart, dba Emergency Pet Clinic, (Bedford Heights, Cuyahoga County) pleaded guilty to three felony counts of fraud for failing to obtain workers’ compensation insurance coverage. Hart is the owner and operator of the Emergency Pet Clinic. She purchased the business in December 1996 but never completed the BWC paperwork indicating she had made the purchase. The BWC policy lapsed in September 2003 when Hart failed to file the BWC payroll report for the first half of 2003 and pay the associated premium. BWC’s employer compliance department made multiple unsuccessful attempts to bring the business back into compliance. The department referred the case to SID’s employer fraud team. Agents attempted to interview Hart, but she either canceled meetings or did not respond. Interviews with current and former employees of the business confirmed Hart did hire employees, and some of those employees had filed injury claims during the time period the policy was lapsed. Hard was sentenced Sept. 24 to one year incarceration suspended for five years of probation. Terms of her probation include making restitution in the amount of $21,023.27, including $2,000 for investigative costs and cooperating with a BWC audit.

Michael Myers (Goshen, Clermont County) pleaded guilty in the Clermont County Court of Common Pleas to one felony count of workers’ compensation fraud for drug trafficking.The Clermont County narcotics task force contacted SID and informed it that Myers may be selling narcotics that BWC paid for as a result of his workplace injury claim. SID worked with the drug task force and had an informant purchase several pills, later identified as prescribed to Myers and paid for by BWC.Myers pleaded guilty Sept. 7 and was placed on probation. He must also pay court costs.

December Combs (Bellefontaine, Logan County) pleaded no contest in Bellefontaine Municipal Court Sept. 11 to charges related to fraudulently creating an online account to access her ex-husband’s claim information. SID received an allegation that Combs assumed her ex-husband’s identity to obtain information for use at child custody hearings. SID found that accusation to be true. Combs must pay a $150 fine.

Albert Harr (Tallmadge, Summit County) pleaded guilty to one count of attempted theft and one count of attempted workers’ compensation fraud, both misdemeanors, for failing to report wages. Harr, a highway contractor for the United States Postal Service (USPS), came under investigation by a special task force to address a trend among contractors of failing to maintain workers’ compensation coverage despite receiving funds from the USPS to purchase coverage. Investigators found that Harr hired an employee to help him operate the route driver but failed to report the employee to BWC. However, he did request and receive reimbursement from the USPS for the additional workers’ compensation costs associated with the new employee. Simply put, Harr pocketed the money instead of using it to purchase coverage with BWC. Harr was sentenced Sept. 20 to one year of probation and ordered to repay restitution in the amount of $2,237.65.

To report suspected workers’ compensation fraud, call 1-800-OHIOBWC, visit ohiobwc.com or visit www.facebook.com/ohiobwcfraud.

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Surveillance video shows Boardman man guilty of workers’ comp fraud

A Boardman man was sentenced for fraud after pleading guilty to working as a landscaper and roofer while receiving workers’ comp benefits.  The Ohio Bureau of Workers’ Compensation (BWC) conducted a surveillance operation and caught Thomas Hofus on camera replacing a roof.

“Workers’ comp is intended for those who cannot return to work while recovering from an injury, however, surveillance by our investigators showed Mr. Hofus was clearly capable of physical work,” said BWC Administrator/CEO Steve Buehrer.  “BWC remains committed to putting a stop to cases like this that place employer dollars in the hands of those who are not honestly representing their ability to work.” 

BWC’s Special Investigations Department (SID) acted on an allegation that Hofus was operating a curbing and landscaping business called World Class Curbing while he was receiving temporary total disability benefits for a prior workplace injury.  Witness interviews, a review of financial records and surveillance videos confirmed he returned to work in violation with those benefits.

The evidence showed Hofus operated as a sales person at home and garden shows, provided on-site estimates for customers, supervised employees at job sites and participated in much of the physical work associated with landscaping and roofing.

Hofus pleaded guilty August 13 to one count of workers’ compensation fraud, a fifth degree felony, in Franklin County Common Pleas Court. He was ordered to pay restitution of $12,662.17 and sentenced to one year incarceration, suspended for three years of community control. Terms of his probation include a substance abuse evaluation, any follow-up treatment recommended, and a requirement to maintain employment.

Surveillance video is available here.

To report suspected workers’ compensation fraud, call 1-800-OHIOBWC, visit ohiobwc.com, or visit www.facebook.com/ohiobwcfraud.

Tallmadge postal contractor guilty of workers’ comp fraud, theft

Albert Harr pocketed USPS payments instead of purchasing workers’ comp insurance

COLUMBUS – A Tallmadge (Summit County) man appeared in court last week after a special task force created by the Ohio Bureau of Workers’ compensation (BWC) found he was committing workers’ compensation fraud.  Albert Harr, a highway contractor for the United States Postal Service (USPS), pleaded guilty to fraud and theft for collecting payments from the postal service to purchase required workers’ compensation insurance coverage but instead pocketing the checks.

“Although it would have presented no out-of-pocket expense to Mr. Harr, he chose to skip the workers’ comp policy and instead keep the payment for himself,” said BWC Administrator/CEO Steve Buehrer.  “This task force has been productive in weeding out contractors who are simultaneously taking advantage of their agreement with the Postal Service and failing to protect their workers.”

The task force was created in 2009 by BWC’s Special Investigations Department in collaboration with the USPS Office of Inspector General to address a trend among contractors of failing to maintain workers’ compensation coverage despite being paid by the Postal Service to purchase coverage.   Harr, a self employed highway contractor transporting mail for the USPS, was suspected of fraud after the task force reviewed his contract. 

Investigators found that Harr has an active BWC policy and reports wages for one driver but failed to report to BWC that he hired an employee to help him operate the route.  As part of his contract, the Postal Service reimburses Harr for expenses, including workers’ compensation costs.  Investigators additionally found that Harr requested and received reimbursement for the additional workers’ compensation costs associated with the new employee. 

Harr pleaded guilty September 20 to one count of attempted theft, and one count of attempted workers’ compensation fraud, both misdemeanors.  He was sentenced to one year of probation and ordered to repay restitution in the amount of $2,237.65.

To report suspected workers’ compensation fraud, call 1-800-OHIOBWC, visit ohiobwc.com, or visit www.facebook.com/ohiobwcfraud.