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Archive for December, 2015

Marion trucking company owner failed to maintain workers’ comp coverage

MARION – A Marion employer who allowed his workers’ compensation policy to lapse and claimed his employees were subcontractors has been sentenced for failing to comply with the law. Lakhvir S. Sidhu, owner of Liverpool Express, was sentenced Dec. 7 after he failed to cooperate with attempts by the Ohio Bureau of Workers’ Compensation (BWC) to help him obtain proper coverage.

“BWC makes good faith attempts to work with businesses to bring them into compliance, but has no choice but to pursue fraud charges when our efforts are ignored,” said BWC Administrator/CEO Steve Buehrer. “Businesses with employees must comply with the law and maintain workers’ comp coverage to protect their workforce.”

BWC’s Employer Compliance Department first attempted to work with Sidhu to bring his policy into compliance but investigators with the agency’s Special Investigations Department opened a fraud investigation after Sidhu did not cooperate.

An audit on the business showed Sidhu was paying wages to employees he claimed were subcontractors. Investigators interviewed Sidhu on several occasions regarding the lapsed policy and the requirement to report wages for his employees. After meeting with agents, Sidhu paid his past due premiums, although he still claimed the workers were subcontractors. The investigation later revealed that Sidhu reported employee wages to the Ohio Department of Jobs and Family Services that totaled $266,000 more than the wages he reported to BWC for the same time period.

The matter was then reviewed by the Marion City Law Directors office after Sidhu failed to enter into a payment plan and/or file the additional payroll information as requested by agents. He was convicted of a second-degree misdemeanor count of failure to comply with the law and was ordered to pay restitution in amount of $3,724.77, and comply with BWC regulations and Ohio laws. Sidhu must also pay fines totaling $400 and serve 90 days of incarceration, suspended for two years community control.

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 see what workers’ compensation fraud looks like in our fraud awareness video on YouTube.

Tuscarawas County woman ordered to repay $9K for workers’ comp fraud

December 31, 2015 2 comments

Robin Beckett of Dennison (Tuscarawas County) has been ordered to repay more than $9,000 to the Ohio Bureau of Workers’ Compensation after investigators found she knowingly committed fraud by working in violation of the workplace injury benefits she was receiving.

The Special Investigations Department Intelligence Unit noted a database cross-match with the Ohio Department of Job and Family Services showed Beckett earned wages during periods when she was also collecting disability benefits for a workplace injury. The investigation produced evidence proving Beckett knowingly and with fraudulent intent worked for Tender Touch Home Health performing various nursing duties while on temporary total disability.

Robin Beckett pleaded guilty to a fifth-degree felony count of workers’ compensation fraud on Oct. 6 in the Franklin County Court of Common Pleas. Judge McIntosh sentenced Beckett to 10 months in prison, suspended for three years of community control. Conditions of her probation include payment of restitution totaling $9,330.29.

BWC investigations result in five workers’ comp fraud convictions in November

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

“Identifying and weeding out fraud is an essential part of not only maintaining fairness, but keeping workers’ comp costs manageable for Ohio employers,” said Buehrer.

The following is a summary of the cases that resulted in guilty pleas or convictions in November:

Latonia Almon (Columbus, Franklin County) pleaded guilty Nov. 16 to a fifth-degree felony count of workers’ compensation fraud in the Franklin County Court of Common Pleas for working while receiving benefits. A cross match with the Ohio Department of Job and Family Service conducted by BWC’s Intelligence Unit identified Almon as possibly working while receiving temporary total disability benefits. SID obtained employment records that revealed Almon she continued to work as a home health aide during the entire period she was collecting benefits for a workplace injury. During an interview, Almon admitted to “kinda” working and receiving payment for the services she provided. Almon admitted she did not inform the BWC of this employment. A pre-sentence investigation has been ordered and sentencing is scheduled for January 15, 2016.

Robert Aleshire (Delta, Fulton County) pleaded guilty Nov. 3 in the Franklin County Court of Common Pleas to a fifth-degree felony count of theft for working while receiving benefits. SID’s Intelligence Unit identified that Alshire was involved in a Public Utilities Commission of Ohio (PUCO) motor vehicle inspection as a commercial truck driver while he was collecting permanent total disability benefits from BWC. The investigation found that Aleshire was driving as an independent contractor under the name MoMo Trucking. The judge ordered a pre-sentence investigation and Aleshire is scheduled to be sentenced on January 13, 2016.

Sandra Houshel (Dayton, Montgomery County) pleaded guilty Nov. 19 in the Franklin County Municipal Court to one first-degree misdemeanor count of workers’ compensation fraud for working while receiving benefits. The judge ordered her to pay a fine of $100 plus court costs. SID began investigating after receiving an allegation that Houshel was working at a restaurant in downtown Dayton while collecting temporary total disability benefits for a workplace injury. The investigation found that Houshel was working at the restaurant most the week, opening the restaurant and working as a waitress. Houshel immediately paid the full restitution of $3,369.24 to the court.

Mike Crawley (Shelbyville, Indiana) pleaded guilty Nov. 16 in the Darke County Court of Common Pleas to one fifth-degree felony count of workers’ compensation fraud for working while receiving benefits. SID began investigating after receiving an allegation that Crawley may be working for a local trailer park. The investigation found that Crawley performed various maintenance work at the mobile home park while collecting temporary total disability benefits from BWC. Crawley is scheduled to be sentenced on January 16, 2016.

Rachel Madison (Bedford, Cuyahoga County) pleaded guilty Nov. 23 in the Franklin County Court of Common Pleas to a fifth-degree felony count of workers’ compensation fraud for improperly receiving dependent death benefits. Madison was eligible to receive death benefits up to age 25 if enrolled at an accredited educational institution. SID received an allegation that she was submitting proof of college enrollment to the BWC in order to receive the benefits but was not attending the classes. Madison’s course schedule from the University of Akron showed that either she failed to attend classes or did not remain in full-time status. She failed to report to BWC that she did not attend classes and was not enrolled as a full-time student but submitted paperwork to BWC in order to continue receiving the benefits. Madison was sentenced to six months in prison, suspended for five years of community control. As a condition of her probation, she is required to pay $12,319.98 in restitution.

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

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

A form of referral

By Jeff Baker, Program Administrator, BWC Special Investigations Department

Every day members of our BWC Special Investigations Department are reminded why we created our on-line fraud referral form. It works. Effective December 1, we had received more than 8,000 allegations from external sources via the referral form. And, since fiscal year 2002, the percentage of new allegations we have received from external sources via referral forms has steadily increased from one percent to 17 percent.

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Here is how the form works: simply select the type of subject you suspect – injured worker, employer, provider, or other – and the interactive form will prompt you for pertinent information. To “complete” the form, just post whatever information you have to a few screens. No field is required. You decide how much or little information you care to furnish us. You may advance past any screen at your discretion. Many sources have furnished their allegations in a matter of a minute or two.
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The form will display a confirmation that we have received your allegation. All members of our SID intake team immediately receive an e-mail containing all information from the form. They promptly enter the allegation into our secure database, the Fraud Management System, and commence their review and research of the subject. If you elect to furnish us with a contact phone number or e-mail address, a SID professional will contact you with an investigative update within 14 days. They will also re-contact you when we have a known outcome, such as a criminal conviction and/or sentencing.

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For example, as recently as December 11, we reported on the conviction of Rachel Madison, a Bedford woman who pleaded guilty to workers’ compensation fraud. She was ordered by the Franklin County Court of Common Pleas to pay $12,319 in restitution to the BWC. SID commenced its investigation of Madison after an acquaintance confidentially reported his/her suspicions via a fraud referral form.

To report suspected fraud via the fraud referral form click here. You may also report suspected fraud by calling either the BWC fraud hotline at 1-800-644-6292 or Jeff in SID Administration at 1-614-466-7837.

Spreading holiday joy with toy drive

By Jeff Baker, Program Administrator, BWC Special Investigations Department

BWC’s Special Investigations Department (SID) has been busy again this holiday season, collecting gifts to donate to toy drives around Ohio. Spreading joy to children in need is a tradition in SID.

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toy drive

James Wernecke, Director of Special Investigations; Karen McMahan, Registered Nurse with SID Health Care Provider Team; Sarah Morrison, Chief Legal Officer

“I’m proud of our department’s commitment to make the holidays a little brighter for children in need,” said SID Director James Wernecke. “We have an impressive team of dedicated professionals who not only do outstanding work all year, but give their best when they celebrate the season each December by making a difference in their communities.”

We encourage you to join the generosity, and find ways to make a difference in your community this holiday season.

Thank you for reading our blog, and happy holidays!

Bedford woman owes BWC $12,000 for workers’ comp fraud

December 11, 2015 2 comments

A Bedford (Cuyahoga County) woman has pleaded guilty to workers’ compensation fraud for misleading BWC about her status as a college student.

Rachel Madison was eligible to receive death benefits up to age 25 if enrolled at an accredited educational institution. SID began investigating after receiving an allegation that she was submitting proof of college enrollment to BWC in order to receive benefits but was not attending the classes. Her course schedule from the University of Akron showed that either she failed to attend classes and/or did not remain in full-time status, which is required to continue receiving benefits.

The investigation found Madison failed to report to BWC that she didn’t attend classes and was not enrolled as a full-time student. However, she continued to submit paperwork to BWC in order to continue receiving dependant death benefits.

Rachel Madison pleaded guilty to one count of workers’ compensation fraud on Nov. 23 in the Franklin County Court of Common Pleas.  Madison was sentenced to six months in prison, suspended for five years of community control. As a condition of her probation, she is required to pay $12,319.98 in restitution to the BWC.

Short-term thinking and short-sighted vision: Employers operating without coverage

By Jeff Baker, Program Administrator, BWC Special Investigations Department

Several of our earliest blogs in this Fraud Awareness Series addressed the critical topic of employer fraud. In “Turning a blind eye to the pot: Employers that operate without coverage,” dated August 10, 2011, we advised readers:

Financial Planning“Ohio law requires employers with one or more employees to obtain workers’ compensation coverage. Noncompliant employers are responsible dollar for dollar for claim costs incurred during a non-covered period.”

This point is certainly worthy of emphasis and reiteration. More than four years later, we continue to close investigations in which we have found employers failed to maintain coverage while employees sustained work related injuries or illnesses. Eventually, their noncompliance would have been detected and investigated without the filing of a claim. However, just one employee’s injury or illness immediately identified the employers as noncompliant. Yes, some of owners and operators initially tried to float an alibi: asserting that the injured employee wasn’t really an employee, just a “volunteer” or a “contracted laborer”. But, of course, truth being the truth – and given the knowledge, skill and experience of our fraud analysts and special agents – the facts disproved the lies. And an employer’s deceit proved the fraud.

Why did the owners and/or leaders of these organizations operate without coverage? Why did they make the unwise decision to incur such risk?

Well, greed is the simplest answer. However, a more full explanation is that the noncompliant owners or operators sought to maximize short-term profitability. Their short-term thinking resulted in short-sighted vision and a failure to recognize future risks – risks that were wholly unnecessary and avoidable. Ultimately, by their noncompliance and incurring dollar for dollar for claim costs, they dramatically increased their operating costs and decreased their long-term profitability. Short-term thinking generated long-term losses.

These noncompliant employers also subjected themselves to criminal and civil proceedings, such as felony workers’ compensation fraud charges, liens and injunctions. These outcomes were probably not consistent with the established vision or mission statement for their business. Moreover, the notoriety they experienced at the point of their criminal sentencing likely did not help them achieve their local marketing and promotional goals.

This was likely the case when Ayed Kanaan, owner of Yaya Food Mart in Cleveland (Cuyahoga County) was sentenced recently after he pled guilty to operating without workers’ compensation coverage. Kanaan did not maintain his coverage even after BWC attempted to work with him to bring the business back into compliance with state law. He will be responsible for the entire cost of a claim that was filed when he didn’t have coverage. Kanaan received a 90 day suspended jail sentence, one year of community control and was ordered to pay restitution in the amount of $7,477.

By their short-term thinking and short-sighted vision, non-compliant employers are blinded to the truth that criminal behavior is never a viable business strategy.

Did you know?

For more information about employer fraud, see page 4 of our Special Investigations Department Fiscal Year 2015 Annual Report.

What you can do.

You can determine if an employer operating in Ohio has workers’ compensation coverage by visiting BWC’s online employer lookup at: https://www.ohiobwc.com/provider/services/mcolookup/nlbwc/default.asp.

If you suspect that an employer is operating without workers’ compensation, let us know. You can report it online at http://bit.ly/reportfraud or you can speak with a fraud hotline agent by calling 1-800-644-6292.