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Archive for November, 2015

Fairfield County employer admits to faking workers’ comp coverage

newellLANCASTER – The owner of a Fairfield County excavating company has admitted to falsifying his workers’ compensation insurance coverage certificate in order to submit bid proposals to the city of Lancaster. William Newell, of Pleasantville, pleaded guilty to workers’ compensation fraud and must repay more than $5,000 to the Ohio Bureau of Workers’ Compensation (BWC).

“Businesses in Ohio are required to maintain workers’ compensation coverage to protect their employees and care for them if injuries occur,” said BWC Administrator/CEO Steve Buehrer. “Falsifying a coverage certificate is not only against the law, it’s unfair to honest employers that are placed at a competitive disadvantage.”

BWC’s Special Investigations Department opened an investigation into Newell after receiving a tip that he submitted an altered BWC certificate of coverage for his business, Bill Newell Excavating, as part of a bid proposal to the city of Lancaster. After the city notified him he needed to obtain coverage in order to submit bids, Newell submitted all outstanding payroll reports to BWC indicating he did not have any employees or payroll. He also paid past due premiums and fees in order to become compliant and receive a valid certificate of coverage.

Through the investigation, BWC’s employer fraud team obtained three additional false certificates that Newell submitted in bid packets during recent years. When interviewed, Newell initially denied having any knowledge of the false certificates but later admitted creating and submitting them. During the interview Newell stated that he always had employees, but later stated he did not have employees and hired sub-contractors.

The investigation ultimately found that Newell did have employees and that he underreported his payroll in order to avoid paying premiums.

Newell entered a guilty plea to one fifth-degree felony count of workers’ compensation fraud on Nov. 17 in the Fairfield County Court of Common Pleas. He was sentenced to a six month prison term, suspended for three years of community control. The conditions of his community control include a restitution payment of $5,404.90 to BWC, and a continuing obligation to provide the court proof of his premium payments.

To report suspected workers’ compensation fraud, call 1-800-644-6292 or visit bwc.ohio.gov. Check out our latest cases at ohiobwcfraud.wordpress.com, follow Fraud Fridays on Twitter @OhioBWCFraud, or join in the conversation at facebook.com/ohiobwcfraud. View and share BWC’s workers’ comp fraud awareness video on our YouTube channel.

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Another type of BWC certificate: Showing our appreciation to yet another source

By Jeff Baker, Program Administrator, BWC Special Investigations Department

Normally, when our readers think of the words “BWC” and “certificate”, they think of the BWC Certificate of Coverage. This makes sense. The certificate is widely seen and easily recognized. It is the official document employers often frame to display within their business.

Understandably, the law-abiding business owner wants every employee and customer to see that they have secured workers’ compensation coverage from our agency. They know that others see it as proof of the business’s legitimacy and a sign of the owner’s prudence.

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Special Agent in Charge Scott Lape, Shelly Long, and Fraud Analyst Stuart Lee

That might explain why Shelly Long, the co-founder and co-owner of a Cambridge business, Acute Nursing Care LLC, was surprised when we contacted her, asking to present her with another type of BWC certificate: a Certificate of Appreciation.

Scott Lape, a Special Agent in Charge with the Special Investigations Department (SID), explained to Mrs. Long that the certificate acknowledges the business owner’s referral of a fraud allegation to BWC – a referral that had resulted in the successful prosecution of the subject. Mrs. Long promptly advised that she had read about the July 27 conviction of the subject, James E Harris (Guernsey County), when she visited the SID Facebook page.

SigneCertificate fraudd by SID Director Jim Wernecke, the framed certificate is a simple way to demonstrate our thanks to Shelly Long and others who are our partners in combating fraud.

Significantly, Mrs. Long received her Certificate of Appreciation during International Fraud Awareness Week (IFAW) 2015. Sponsored annually by the Association of Certified Fraud Examiners, IFAW is dedicated to the prevention, identification and investigation of fraud – wherever it might occur throughout the world.

Just like Shelly Long, you are our eyes and ears in Ohio! Thank you for your help in stamping out fraud, and please, keep those tips coming. To report workers’ comp fraud to BWC, click here or call our fraud hotline at 1-800-644-6292.

Categories: Fraud Awareness

Massillon woman bets wrong; fraud scheme ends up a bust

Brenda Pumphrey of Massillon (Stark County) claimed a workplace injury caused her to lose use of each hand, one arm and one leg. After surveillance at a West Virginia casino showed no limp and full use of her arms, Pumphrey’s luck ran out and she ended up pleading guilty to workers’ compensation fraud.

An investigation into Pumphrey’s claim started with a speeding ticket. SID received an allegation from a BWC Customer Service Specialist that Pumphrey was issued a speeding ticket in Stark County on a date following her claimed loss of her ability to use her upper extremities.

A case was opened and a review of the claim showed that Pumphrey’s physician of record had continuously advised that she was unable to use her extremities but was reluctant to obtain some treatment that was advised.

Agents conducted surveillance of Pumphrey visiting her doctor’s office. Additionally, Pumphrey’s bank records showed a high volume of ATM and debit card activity at the Mountaineer Casino, located in Chester, West Virginia. Video from the casino showed Pumphrey walking with no noticeable limp and with full use and range of motion of both arms.

The physician concluded after seeing the casino video that it appeared Pumphrey had intentionally deceived him. The Ohio Industrial Commission terminated her Permanent Total Disability benefits.

On Friday, Oct. 16, Brenda Pumphrey was sentenced on her previously entered guilty plea to a felony count of workers’ compensation fraud. She was placed on community control for three years and ordered to pay restitution of $9,192.75. Pumphrey will serve six months in jail if she violates the terms of community control.

BWC SID: Our Journey to Excellence – Part 3 of 3

November 19, 2015 1 comment

In our constant quest for improvement, all members of the Bureau of Workers’ Compensation Special Investigations Department (SID) annually complete in-service training. The theme of this year’s training event was “Our Journey to Excellence: Past, Present and Future.” On October 22, by SID Director James Wernecke, we shared investigative successes and presented awards to teams and individuals.

Preparations: In September, all 123 SID employees had been invited to nominate a peer to receive an individual award. A management committee furnished behavioral characteristics for use by SID employees when submitting written justifications for any peer nomination. These characteristics varied according to the type of award: Star; Excellence in Service; and Leadership. In reviewing all nominations, the committee members found that several nominees were nominated by multiple colleagues. Ultimately, the committee selected eight most-worthy SID employees.

Presentations: These talented and dedicated professionals received their awards at the culmination of the October 22 event.

fraud part 3 pic 1Two employees received Star awards, including Karen McMahan (pictured at right), a Registered Nurse with the Health Care Provider Team (HCPT). They met five criteria including: approaching new challenges with a “can do” attitude; involving themselves above and beyond in community outreach and/or volunteerism; and encouraging and mentoring peers and co-workers;

Fraud part 3 pic 2Four employees earned Excellence in Service awards, including T. Michael Hostin (pictured at left), an investigator with the Safety Violations Investigation Unit (SVIU); and Pam Hunnicutt (pictured below right), an administrative professional with SVIU.

fraud part 3 pic 3They met four standards including: demonstrating extraordinary commitment by continuously providing excellent service to internal and external customers; and demonstrating a positive attitude, using strong judgment and good communication skills while promoting teamwork.

Two other employees received Leadership awards. They satisfied six criteria, including: setting a high standard of integrity; leading by example and maintaining high personal standards; inspiring a high level of commitment from others when taking on new initiatives; and sharing responsibility, authority, information, and credit when working towards the achievement of a goal.

Please, join us in thanking and congratulating each of the SID award nominees and recipients. They are the reason we are able to confidently strive towards excellence.

You can read the first article about our October 22 event here, the second article about the event here, and our most recent annual report here.

Fraud, integrity the focus of recent conference

fraud badge 2 2015Two fraud analysts and a special agent from the Ohio Bureau of Workers’ Compensation’s Special Investigations Department (SID) attended the two-day Targeting Fraud: Safeguarding Integrity conference in Columbus. During the conference, they gleaned ideas from the latest information on specialized investigative topics, such as cybercrime, ethics laws, surveillance, social media and the investigative use of geocoded photo metadata.

The SID employees will share what they’ve learned with their colleagues, and use those strategies while conducting joint investigations with other law enforcement professionals, some of whom also attended the conference on November 4 and 5.

Ultimately, using what they learned at this and other training seminars, SID professionals seek to secure even more results than the $60.5 million in savings they identified last year, as outlined in our FY 2015 annual report.

For more articles from our blog, please visit ohiobwcfraud.wordpress.com.

 

The big business of health care provider fraud

As you can see from reading this blog, we take all types of fraud seriously and fraud committed by health care providers is no different.

In fact, in 1994 we created the Health Care Provider Team (HCPT) to exclusively investigate this type of fraud.

This past fiscal year HCPT closed 64 cases, identified $19M in savings, made 11 criminal prosecution referrals, and obtained 3 convictions.

Just to give you an idea of the types of fraud committed by health care providers, here are a few of our most notable, recent cases.

Lawanna Porter, of Shaker Heights, who operated Palladium Healthcare, a home healthcare agency with more than 100 employees, failed to report having employees to various state agencies or to secure workers’ compensation, and failed to report her payroll to BWC. SID conducted this joint investigation with the Ohio Attorney General’s Office, Medicaid Fraud Control Unit. In addition to restitution, Porter was ordered to pay BWC $15,000 in investigative costs, for a total of $139,573. She was also sentenced to five years of community control. If she violates the terms of her sentencing, Porter could be sent to prison for 11.5 years.

Nelsonville chiropractor Michael L. Brown, D.C., whose patients were not at his office on days that he billed BWC for treating them, including dates his office was closed, and who fabricated the amount of treatment he provided to patients to receive a higher payment for services. Brown was ordered to pay $394,021 in restitution, which includes approximately $60,000 in investigative costs. He was sentenced to five years of probation. If he fails to comply with the terms of his probation, Brown could be sentenced to serve nine months in jail. Brown voluntarily decertified himself as a BWC health care provider.

Jeffrey Stychno, D.C., an Ohio chiropractor was sentenced to pay $89,000 in combined restitution to Medicaid and the Bureau of Workers’ Compensation (BWC). Stychno was ordered to pay $69,781 to BWC and $19,715 to Medicaid after he was convicted of fraudulent billing practices during his time as co-owner of Integrated Health in Warren, Ohio.

Joseph J. Yurigan, D.C., a chiropractor who formerly practiced in Weirton and Wheeling West Virginia was sentenced for health care fraud and tax evasion. Our investigation revealed Yurigan was routinely and consistently billing for services that he never provided to undercover operatives. The Federal Bureau of Investigations, the West Virginia Department of Insurance Commission, United States Treasury Department and the United States Attorney’s Office became involved in the investigation and executed a search warrant. Yurigan pleaded guilty and yesterday was ordered to make restitution totaling $836,066.

After reading these cases you have most likely come to the same conclusion…this big business is just not worth it!

BWC SID: Our Journey to Excellence – Part 2 of 3

By Jeff Baker, Program Administrator, BWC Special Investigations Department

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Toby Smith commences his presentation.

In our constant quest for improvement, all members of the Bureau of Workers’ Compensation Special Investigations Department (SID) gathered on October 22, 2015 at our Mansfield service office to successfully complete annual in-service training. The theme of this year’s training event was “Our Journey to Excellence: Past, Present and Future.” Led by SID Director Jim Wernecke, we shared investigative successes, learned how to use new technology recently secured, and committed to operational strategies for even greater effectiveness.

We’ve found that one of the chief ways to find new or alternate methods of fraud detection and investigation is to consult counterpart agencies. Such collaboration allows SID to examine its own methods to see where improvements can be made, how tasks can be accomplished more efficiently, and what new strategies or technologies can be used in the course of an investigation.

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Toby Smith holds certificate presented by Jim Wernecke.

This is why Director Wernecke wisely invited Toby Smith, a talented Assistant Director of Security Services with the Industrial Commission of Ohio, to be our keynote speaker. In fewer than 90 minutes, the retired sergeant with the Ohio State Highway Patrol increased our awareness and skills in conducting “Crucial Conversations” to enhance organizational communication and investigative team work.

To acknowledge our appreciation of his training, Director Wernecke presented Assistant Director Smith with a certificate, noting that it is an honor for us to recognize, praise and thank him. We respect and appreciate all of our law enforcement colleagues for their dedication to serving and protecting the citizens of the state of Ohio. Thanks to their willingness to effectively guide others on their respective journeys, we may be confident in soon reaching our intended destination.

You can read the first article about the October 22 event here and our most recent annual report here.

Who we are, what we do and why we do it…

Combating workers’ comp fraud in Ohio

It’s International Fraud Awareness Week and we’re on board to help educate the public about workers’ comp fraud.

In a nutshell, here’s who we are, what we do and why we do it…

Questions? Don’t hesitate to leave a comment below.

The following statistics are through June 30, 2015.

SID infographics 2

Fraud Awareness Week begins Nov. 15!

Fraud Week LogoThanks to the Association of Certified Fraud Examiners sponsorship and the power of social media, fraud awareness is spreading. We’re joining forces with more than 150 companies and organizations to educate the public about different types of fraud happening all over the world.

This campaign encourages business leaders and employees to promote anti-fraud awareness and education to help minimize fraud’s impacts.
We’re taking a stand and making it clear to potential fraudsters we’re on the lookout and using sophisticated detection methods to find them. Ultimately, there’s a serious price to pay for committing fraud.

Since 1993, our Special Investigations Department has researched and reviewed 115,474 allegations of workers’ compensation fraud, completed 62,985 investigations resulting in 2,485 criminal convictions and identified nearly $1.7 billion in savings.

Workers’ compensation fraud can be committed by an employer who isn’t truthful about the amount of payroll reported for workers’ compensation premiums, a claimant faking an injury to get some time (and money) away from work, or a medical provider who is overbilling. These are just a few examples.

Read more about International Fraud Awareness Week here and stay tuned throughout the next week for tips, articles and new cases here on our blog, ohiobwcfraud.wordpress.com, and also on Twitter, Facebook and YouTube.

BWC investigations result in six workers’ comp fraud convictions in October

Columbus – Ohio Bureau of Workers’ Compensation (BWC) Administrator/CEO Steve Buehrer announced today that six individuals were convicted of, or pleaded guilty to, charges related to defrauding Ohio’s workers’ compensation system in October 2015. These court actions are the result of investigations conducted by BWC’s Special Investigations Department (SID).

“Employers pay premium to BWC with the expectation that those dollars go toward the care and recovery of their workers who are injured on the job, not to dishonest claimants, employers or medical providers,” said BWC Administrator/CEO Steve Buehrer. “I am pleased our investigators were able to put an end to these attempts to defraud the workers’ compensation system.”

The following is a sampling of cases that resulted in guilty pleas or convictions during October:

Krystal Knight (Toledo, Lucas County) pleaded guilty Oct. 6 in the Lucas County Court of Common Pleas to one misdemeanor count of attempted theft for forgery. An investigation by BWC’s special investigations department revealed that Knight cashed two checks from Catholic Healthcare Partners, which were self-insured disability payments issued to another claimant, Judith Burris, in July 2014. The checks, totaling $1,062, were cashed after Burris, her mother, passed away on June 29, 2014. The investigation proved that Knight signed Burris’ name on the checks and presented Burris’ license to Huntington Bank in order to cash the checks. As part of a plea agreement, Knight was sentenced to pay restitution to Catholic Healthcare Partners in the amount of $1,062, but Knight failed to make the payment. She is scheduled for sentencing on November 17, 2015.

James Orr (Bethel, Clermont County) pleaded guilty Oct. 6 in the Hamilton County Municipal Court to a fourth-degree misdemeanor count of disorderly conduct for filing a false claim. Orr filed a claim with the BWC alleging he was injured in 2010 while working at Solutions Plus in Amelia.  Investigators interviewed co-workers and found that Orr had told them he hurt his back landscaping and working on his personal vehicle.  A medical report noted that Orr told the doctor that he was hurt at work two days prior to the alleged injury date on the first report of injury, and had sought treatment the next day at Clermont Mercy Hospital. Investigators found that Orr had not been treated by Clermont Mercy Hospital and time cards from the employer indicated that Orr did not work on the date of the alleged injury. Orr was sentenced to three days credit in the Hamilton County Jail, court costs, and ordered to stay employed.
Ralph Dollison (Circleville, Pickaway County) pleaded guilty Oct. 28 in the Franklin County Court of Common Pleas to one first-degree misdemeanor count of workers’ compensation fraud for working while receiving benefits. SID received an allegation that Dollison was working while receiving compensation for a workplace injury. The investigation proved Dollison worked for a concrete company as a laborer and performed duties such as digging, building forms, pouring concrete and finishing concrete. Evidence also revealed he intentionally misrepresented and withheld his employment in order to continue collecting the disability benefits. Dollison was ordered to pay $4,081.47 in restitution and placed on community control for five years. He was also sentenced to 180 days in jail, suspended as long as he complies with the community control.

Donald Detrick (West Mansfield, Logan County) pleaded guilty Oct. 27 in the Franklin County Court of Common Pleas to a misdemeanor count of workers’ compensation fraud for working while receiving benefits. SID opened an investigation after receiving an allegation that Detrick may be working while receiving benefits for a workplace injury. The investigation revealed that Detrick worked as the fire chief for Bokecreek Township in Logan County, fire safety coordinator for York Township in Logan County and as a certified water inspector for Midwest Express while collecting temporary total disability benefits.  Prior to the plea, Detrick paid $25,586.40 to the Clerk of Courts in order to pay in full his restitution of $22,155.04 and investigative costs of $3,431.36. A judge sentenced him to community control for six months under the condition that he pay the restitution and investigative costs, have no new convictions, and pay all court costs. He will serve six months in jail if he does not meet these terms.
Timothy Morrow (Delaware, Delaware County) pleaded guilty to one first-degree misdemeanor count of workers’ compensation fraud on Oct. 20 in the Franklin County Court of Common Pleas for working while receiving benefits. SID opened an investigation after receiving an allegation that Morrow was operating his own HVAC business while receiving disability benefits from the BWC.  The investigation, which included a review of bank records and multiple interviews, confirmed Morrow did own and operate a business, TTM Mechanical, and conducted HVAC installations and repairs during the time he was receiving benefits. The evidence obtained during the course of the investigation also revealed that he intentionally misrepresented and withheld his employment from BWC. Morrow was sentenced to 30 days in the Franklin County Jail, suspended, and was placed on six months of probation.  He was also ordered to pay court costs along with $8,399.74 in restitution to BWC.  The restitution was paid at the clerk’s office after the hearing.

To report suspected workers’ compensation fraud, call 1-800-644-6292 or visit bwc.ohio.gov.

Check out our latest cases at ohiobwcfraud.wordpress.com and view BWC’s workers’ comp fraud awareness video on YouTube.

Seated at the summit: Benchmarking for peak performance

By Jeff Baker, Program Administrator, BWC Special Investigations Department

To meet our ongoing commitment for improvement, BWC’s Special Investigations Department (SID) works to foster an ongoing exchange with our counterparts both in Ohio and nationally to keep on top of the best fraud prevention strategies.  Last week, we participated in an Ohio Insurance Fraud Summit, sponsored by our colleagues in the Ohio Department of Insurance.

SID Dan FodorDan Fodor, the special agent in charge of the SID Intelligence Unit, participated as a subject matter expert on two panel discussions: “Emerging Fraud Trends” and “Data Mining as Part of a Fraud Prevention Plan”. He is uniquely qualified to speak on these topics. The Intelligence Unit he has successfully supervised since 1999, identified $37 million in savings during the last fiscal year alone.

Of course, the specific content of the panel discussions is confidential. Otherwise, would-be fraudsters might think themselves capable of using the “inside information” to avoid detection. Access to the summit was restricted by invitation only to those with a demonstrated need to know. Nonetheless, we can report that the effective benchmarking that occurred at the summit will generate even greater performance results for each participating law enforcement agency. As Dan noted, following the summit:

“It was a great opportunity to share some of our successes and experience in detecting insurance fraud. Bottom line, you have to think like a criminal to catch one.”

Thanks to effective collaborations, such as this summit, SID and its allies are increasingly realizing their mission to deter, detect, investigate and prosecute insurance fraud.

You can read the past posts about our SID Director here and our most recent annual report here.

Circleville laborer sentenced for workers’ comp fraud

Ralph Dollison booking photoRalph Dollison of Circleville (Pickaway County) was ordered to repay more than $4,000 for committing workers’ compensation fraud.

SID received an allegation that Ralph Dollison was working while receiving compensation for a workplace injury. The investigation proved Dollison worked for a concrete company as a laborer and performed duties such as digging, building forms, pouring concrete and finishing concrete.  Evidence also revealed he intentionally misrepresented and withheld his employment in order to continue collecting the disability benefits.

Dollison pleaded guilty Oct. 28 in the Franklin County Court of Common Pleas to one first-degree misdemeanor count of workers’ compensation fraud. He was ordered to pay $4,081.47 in restitution and placed on community control for five years. He was also sentenced to 180 days in jail, suspended as long as he complies with the community control.