Fraud On-the-Job

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High Angle View Of A Person With Fractured Hand Filling Health Insurance Form

Workers’ compensation benefits are meant to provide financial compensation to those who have been injured while on-the-job. Fraudsters often try to abuse this program by lying about sustaining injuries or being unable to work. A California woman from San Leandro admitted to forging signatures of doctors so she could receive over $10,000 in workers compensation benefits. Marlene Cavalcanti pleaded guilty to two counts of insurance fraud and identity theft.

Cavalcanti claimed that she sustained injuries from falling at her job as an executive assistant. (Did she trip over the water cooler? Step on a thumb tack?) She initially received medical treatment for the injuries and was paid over $42,000 in temporary compensation.

One of the conditions of receiving disability payments is that you are unable to return to work. Cavalcanti violated these conditions by starting to work for a new company while she was still receiving disability payments from the state. (The key personality trait that all fraudsters share is greed – they always want more and more money. Sometimes, that leads to double-dipping.)

She continued to submit fictitious doctor reports during this time despite the fact she had stopped receiving medical treatment for her injuries. The falsified documents included doctors’ signatures that Cavalcanti had forged in an attempt to apply for more disability payments. This includes an attempted filing for $10,590 in workers compensation claims. (Forging records never ends well for the criminals you see on the news, why try it?)

Cavalcanti also attempted to file a bogus workers’ compensation claim through her new employer using a different insurance company. In this claim she fraudulently asserted that she had fallen at work in a similar manner to her original claim. (I’m starting to believe she never fell in the first place.) The insurance company conducted an investigation and prevented payment on her fraudulent workers compensation claim.

Workers’ compensation fraud is not a victimless crime and directly hurts consumers. Fraudulent insurance claims lead to a raise in premiums so that health care insurers can make up for the loss they have ensued. Companies raise costs to cover the increased costs of insurance and then passes that along to the consumer. (Everyone else pays for the crimes of the guilty and the greedy.)

Other examples of workers’ compensation fraud are businesses underinsuring their employees. Smaller businesses, who follow the law, cannot afford to cut costs when bidding for new business. This gives companies who illegally underinsure their employees an unfair competitive advantage.

California requires their companies to purchase workers’ compensation insurance to reimburse their employees if they sustain an injury on-the-job. Cavalcanti took advantage of a system meant to protect workers and could face prison time for her actions. She may also be required to pay back the full monetary amount of the fraudulent benefits received. (I hope she had some money saved in her piggy bank because that’s going to be one steep fine.)  

Today’s Fraud of the Day comes from an article, “San Leandro woman pleads guilty to workers’ comp fraud,” published by San Francisco Chronicle on August 1, 2020.

A San Leandro woman has pleaded guilty to forging doctors’ signatures in order to receive more than $10,000 in workers’ compensation, state insurance officials announced Friday.

Marlene Cavalcanti, 40, pleaded guilty on July 24 to two felony counts of insurance fraud and identity theft for falsifying records when filing a workers’ compensation claim to receive $10,590. The company she worked for when she filed the fraudulent documents is located in Marin County, according to state insurance officials.

 

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.