Category Archives: Fraud

Fraud

Man ordered to repay $340K in workers’ comp scam

Renton man ordered to repay $340K in one of state’s largest workers’ comp scams.

The Washington State Department of Labor & Industries (DLI) announced the results of the prosecution of the injured worker on June 23rd.

The fraud case
Thurston County Superior Court Judge Chris Lanese ordered the Renton man to repay DLI more than $339,900. The judge also sentenced Mr. Strasbaugh to 45 days in electronic home monitoring.

Robert J. Strasbaugh, 67, who was receiving a workers’ compensation pension when he was caught, pleaded guilty to felony first-degree theft in the case. Mr. Strasbaugh was working as a delivery driver, using his wife’s name, while receiving total disability pension benefits.

Mr. Strasbaugh, who has already begun to pay back the state, fraudulently received nearly $342,000 in time loss, pension, and vocational benefits from 2012 to early 2017.

“Our investigation showed Mr. Strasbaugh was deliberately deceitful in his attempt to cheat the workers’ comp system,” said Chris Bowe, assistant director of DLI’s Fraud Prevention & Labor Standards division. “We truly appreciate the public’s help in tipping us off to cases like this.”

“Fraud is not a victimless crime. It hurts honest workers and employers who pay into the system and can cause their rates to rise.”

Anonymous tip
DLI began investigating Mr. Strasbaugh in 2017 after receiving an anonymous tip that he was working under his wife’s name, according to charging papers.

At the time, he was receiving DLI payments to replace part of his wages due to an on-the-job injury he suffered in 2003. A doctor had determined Mr. Strasbaugh could not work because of the knee injury and permanently disqualified him from returning to his job as a delivery driver.

Yet despite his official declarations to DLI that he was not working, a two-year investigation determined Mr. Strasbaugh had worked multiple delivery driver jobs around the state from May 2012 to January 2017.

Using wife’s name
Investigators determined Mr. Strasbaugh used his wife’s name and her Social Security number while working as a delivery driver for one company for about three years. The company owner said Mr. Strasbaugh’s work included loading and unloading freight.

The investigation also found he worked as a contracted driver under his own name for an apple delivery company. An auto rental business provided records showing that Mr. Strasbaugh rented delivery trucks 26 times over an 18-month period, each time signing his name and the company name.

DLI pension
Based largely on doctor assessments and claimant statements, Mr. Strasbaugh was found to be totally and permanently disabled in 2016. His wage-replacement payments ended, and he qualified to receive DLI pension payments for life, as long as he did not work.

DLI ended Mr. Strasbaugh’s pension in 2018 a result of the fraud investigation.

Worker Fraud Hurts Other Injured Workers

Statistically, most workers’ compensation fraud is promulgated by employers. Attempts to avoid paying premiums through mis-classification of workers, under-reporting hours worked, or labeling workers as independent contractors are common forms of employer fraud.

When an injured worker is found to have committed blatant fraud, as seems to be the case here with a man ordered to repay $340K, other injured workers are then also subject to suspicion of fraudulent activity. This leads to an undercurrent of disbelief in the administration of claims. Doctors may doubt the truthfulness of their patients. Claims Managers may suspect the worst of their claimants.

Going through the process of a workers’ compensation claim, from injury through medical treatment, return to work and claim closure, is already a difficult process. No injured worker needs the added scrutiny and, often, delays brought on by news of blatant claimant fraud.

Prior Posts on Related Topics
Fraud

Judge orders Federal Way, WA Woman to Repay Nearly $25,000 in Workers’ Comp Scam

DLI News Release:

A Federal Way, WA woman who worked full time as a nanny while claiming she was too disabled to work pleaded guilty to felony theft.

Yurizan Cuevas, 33, was ordered to repay the Department of Labor & Industries (L&I) $24,847, the amount she received in wage-replacement payments over a period of almost two years. King County Superior Court Judge Bruce Heller also sentenced Cuevas to 20 days in jail, which was converted to 160 hours of community service.

Cuevas, who’s also known as Yurizan Cuevas Nava, pleaded guilty at the hearing this week to second-degree theft.

The Washington Attorney General’s Office prosecuted the case based on an L&I investigation.

Injured in workplace robbery

Cuevas was a baker and cashier at a cafe in the White Center neighborhood of Seattle when it was robbed in November 2010. While running from the robber, she hit a wall and injured her back.

Health care providers verified Cuevas couldn’t work because of injuries from the incident, allowing her to receive wage-replacement payments from L&I. 

An L&I investigation later revealed, however, that Cuevas worked full time as a nanny, earning an estimated $3,200 a month for nearly two years starting in September 2011. According to charging papers, she also worked six weeks in 2011 as a house cleaner for another employer — performing both jobs while stating on official forms that she could not work because of her injuries.

In an interview with an L&I investigator, Cuevas acknowledged that she worked as a housekeeper and said she babysat for just a few days. But when confronted with timesheets, charging papers said, Cuevas admitted she served as a nanny from the time her charge was three months old to two years old. She’s accused of stealing more than $24,800 in wage-replacement checks from the state.

 

Photo credit: Jason L. Parks via Foter.com / CC BY-NC-ND

 

 

Fraud, independent medical examiner, insurance carriers

Work Comp Fraud? What Fraud?

Despite what the media portray, workers’ comp fraud is extremely rare.

Today’s post comes from guest author Charlie Domer, from The Domer Law Firm.

Workers are not “getting rich” from worker’s compensation! Accordingly, fraudulent behavior in work comp is very rare—like the one bad apple spoiling the bunch—but often highly publicized. (Because, let’s face it, seeing a surveillance video of someone bowling or water-skiing is far more memorable than a thousand images of an injured worker struggling to get out of bed in the morning or walk a city block).

Under Wisconsin’s nationally-recognized model, a worker who suffers an on-the-job-injury receives workers’ compensation benefits without regard to fault. By virtue of the work comp system, injured workers cannot sue their employers or receive jury awards. Instead, injured workers are eligible for lower, defined benefits, like lost wages and medical expenses—again, we’re not talking about “pie in the sky” numbers that would incentivize bad behavior!

“Fraud” is minimal to non-existent

  • In the last published study, Dept. of Workforce Development (DWD) concluded that public perception of workers’ compensation fraud is exaggerated. In a six year span, the amount of prosecuted fraud was less than one in 20,000 work injuries…or 0.0001%.1

Industry insiders don’t think this is a big deal

  • Rick Parks, the President/CEO of Society Insurance: “From the view of thousands of claims over decades, fraud is minimal in Wisconsin”2 
  • Chris Reader of Wisconsin Manufacturers & Commerce: despite the “sensational stories,” fraud is “few and far between” in the system.3

Current law already allows criminal prosecution for alleged “fraud”

  • Worker’s Compensation Division already has an existing fraud hotline for the public. Also, a carrier can report an alleged fraudulent claim to the DWD. After an investigation, DWD can refer to district attorney for prosecution of criminal insurance fraud. Thus, if there is fraudulent behavior, under current law, there can be a crime found.

Independent Medical Examinations provide protection against “fraud”

  • Insurance carriers can require an injured worker to be seen by a handpicked independent medical examiner, or IME. If questions exist about a worker’s injury, symptoms, or disability, the IME can provide an opinion—allowing a carrier to deny the worker’s claim.

“Fraud” goes both ways

  • We want fair competition in the marketplace and in business. Misclassifying employees or workplaces results in “stolen” premium dollars and an unfair business advantage. Likewise, limiting or under-reporting work injuries undermines the fairness and credibility of our efficient work comp ratings process and system.

 

—–

1 Department of Workforce Development, Annual Report for Calendar Year 1999 Allegations of Worker’s Compensation Fraud (annual average of 3 prosecuted cases out of 60,000 injuries).

2 Senate and Assembly Committees on Labor, Informational Meeting, 7/31/13: WisconsinEye at 3:18:30.

3 Senate and Assembly Committees on Labor, Informational Meeting, 7/31/13: WisconsinEye at 2:13:00.

Fraud

Roofing Company Owner Faces Felony Charge for Not Paying Workers’ Comp

A Mason County, WA roofing contractor faces a criminal charge for allegedly failing to provide workers’ compensation insurance for his employees while they were on the job.

The Washington State Attorney General’s office has charged Peter Daniel Yeaman, 55, with unregistered contracting and doing business when his workers’ comp coverage was revoked.

The latter charge is a felony with a penalty of up to five years in prison and a $10,000 fine. Yeaman is scheduled for arraignment in Kitsap County Superior Court today, July 23.

The case resulted from a Department of Labor & Industries (L&I) investigation into Yeaman and his company, Southgate Roofing, of Belfair.

 

Unfair business advantage

“When contractors skip out on workers’ comp, it’s illegal and it’s incredibly unfair to legitimate contractors who pay their fair share and get underbid by these lawbreakers,” said Annette Taylor, deputy assistant director of L&I’s Fraud Prevention & Labor Standards. 

“Workers’ comp premiums for roofers are among the highest in building construction and the trades, based largely on the safety risks those workers face.”

State law requires employers to provide their employees with workers’ compensation insurance. The coverage provides medical care and other financial support if employees are injured on the job.

Construction contractors also must register with L&I. The department confirms they have liability insurance and a bond and that, if they employ workers, they’ve paid their workers’ comp premiums.

 

At least six roofing employees

L&I suspended Southgate Roofing’s contractor registration in November 2012 for failing to pay workers’ comp premiums, and later officially revoked the company’s workers’ comp coverage.

Nonetheless, according to the charges, L&I found two consumers in Silverdale who had work done by the company in May 2014 and in August 2014.

During the August job, six workers told an L&I inspector they worked for Southgate Roofing. Yeaman himself told the inspector he needed to pay a bill before he could register as a contractor, charging papers said.

 

Eight previous infractions

In addition, the charges say that between October 2013 and September 2014, the company bought roofing materials numerous times from a Bremerton supplier and made numerous trips to a Bremerton disposal site.

Apart from the criminal charges, L&I has cited Yeaman with six unregistered contracting and two permit-related infractions since 2013, and several safety violations in 2013. L&I currently lists him as ineligible to bid or work on public works projects. He owes the department more than $28,000 for the unpaid fines and more than $131,000 for unpaid workers’ comp premiums, penalties and interest.

Photo credit: davidwilson1949 / Foter / CC BY 

Fraud

Man Used Seahawks’ Names to File Claims & Get Drugs

Jail time for Spokane-area man who used Seahawks’ names to get drugs 

A Spokane Valley man has been sentenced to six months in jail for faking on-the-job injuries and using Seahawks players’ names to get narcotics and other prescription drugs.

Spokane County Superior Court Judge Harold Clarke also ordered Jeffory Leonard Mock to repay the eight Spokane-area hospitals and clinics that he scammed to get drugs. Restitution to the facilities, and to the Department of Labor & Industries, is estimated at nearly $17,500. The 34-year-old pleaded guilty in April to four felony counts of obtaining a controlled substance by fraud.

The Washington Attorney General prosecuted the case based on a Washington State Department of Labor & Industries (L&I) investigation.

 

Fake workplace injuries to back, buttocks

Mock visited the medical facilities at least 17 times from March 2013 to May 2014, where he obtained Valium, hydrocodone and other prescription drugs, charging papers said. Each time, he falsely claimed he was working when he injured his back, buttocks or another part of his body.

As part of the scheme, Mock wrote sham names on L&I workers’ compensation forms that he completed at the hospitals and clinics. He used variations on his first name or another first name that usually started with “J.” For the last name, he typically signed the surname of a Seattle Seahawk or another pro ball player or coach.

Mock names included Sherman, Okung, Bledsoe and Largent

Among the last names of football players and coaches he used were: Harvin, Largent, Sherman, Mora, Richardson, Hollenbeck, Robinson, Okung, Marino, Bledsoe and Henderson.

Mock would claim he was injured while working for a moving, roofing or interior design company or retirement home. However, L&I investigators found that four of the employers he listed on forms didn’t exist. 

L&I began investigating the case when a real business listed on a form said the reports might have been filed by a former employee: Mock. A handwriting expert examined the bulk of the injury accident reports, and confirmed that each one matched samples of Mock’s writing.

Fraud

Spokane Card Dealer Charged with Theft in Disability Scam

A card dealer who claimed he was too injured to work has been charged with stealing workers’ compensation benefits after he was caught working at casinos in Spokane.

Victor O. Arredondo, 58, is scheduled to be arraigned Monday, June 15, in Spokane County Superior Court on a felony count of first-degree theft. The Spokane man is accused of stealing more than $27,000 in wage-replacement checks and vocational rehabilitation services from the Washington State Department of Labor & Industries (L&I).

The Washington Attorney General’s office filed the charges based on an L&I investigation.

Arredondo claimed he injured his lower back in May 2013 while working as a card dealer at a Spokane casino. L&I opened a claim for Arredondo, and two doctors and a nurse practitioner certified he should receive wage-replacement payments. He received the workers’ comp benefits from June 2013 through March 2014.

An L&I investigation, however, later found that Arredondo continued to work as a card dealer for nearly the entire eight months he was collecting workers’ comp benefits. Instead of working where he was injured, he was hired for separate stints at two other casinos in Spokane.

Arredondo’s medical providers told L&I that if he had told them he was working, they would not have certified him to receive the state benefits, charging papers said.

Investigators were alerted to the case by cross-matching L&I data with those of other state agencies.

“This case serves as a warning to people who fake or exaggerate workers’ comp injuries. Odds are, we’ll track you down,” said Elizabeth Smith, who directs L&I’s Fraud Prevention & Labor Standards. “We have safeguards in place to detect fraud, and protect the workers’ comp system for truly injured workers.”

Fraud

Contracting Scams Result in Jail Time and Fines

Seattle – A contractor who scammed two building owners has been sentenced to four months in King County Jail and ordered to pay more than $25,000 in restitution.

Collin Patrick Chester, 43, pled guilty in December 2014 to two felony charges of first-degree theft. Superior Court Judge Theresa B. Doyle ordered Chester into custody immediately after sentencing March 27 and filed a 10-year no-contact order with the owners or buildings.

“Justice for consumers is important,” said Elizabeth Smith, assistant director of the Fraud Prevention & Labor Standards Program for the Washington State Department of Labor & Industries. “This is sadly another example of someone trying to take advantage of people who simply wanted to get needed work accomplished.”

In one case, in the spring of 2012, the owner of the Quality Inn on Maple Valley Highway in Renton agreed to pay Chester $70,000 to replace the roof. The only work Chester did was to hire an unregistered subcontractor who tore off a portion of the roof and then abandoned the job because he was not paid, leaving an open roof that resulted in water damage to the hotel when it rained.

In the second case, Chester was contracted to build a new roof for a building in Shoreline. He said he would do the work for $16,000, but no work occurred from May to September 2013, when it was supposed to take place.

In both cases, the building owners paid for some of the work in advance and faced additional expenses to complete the projects. Chester’s previous criminal history included three cases of contracting without a license, a gross misdemeanor.

L&I can help building owners hire smart. Go online to www.protectmyhome.net to verify contractor registration, report fraud, and find agency representatives at many home shows around the state. Upcoming events include the Spokane SHBA Premier Home Improvement Show April 10 – 12, at the Big Home & Garden Show April 18 – 19 in Lacey, and at the Clark County Home & Garden Idea Fair in Ridgefield, April 24 – 26.

Fraud, Workers' Compensation

Are You Really an Independent Contractor?

Today’s post comes from guest author Jon Rehm, from Rehm, Bennett & Moore.

“Calling a dog’s tail a leg does not make it a leg.” Abraham Lincoln

FedEx drivers recently won two class-action lawsuits in the 9th Circuit Court of Appeals. The court ruled that FedEx wrongfully withheld overtime pay, Social Security, unemployment, Medicare and other benefits to drivers because they were misclassified as independent contractors rather than employees. The decisions were driven by the fact that FedEx exercised control over the appearance of drivers as well as what packages to deliver, on what days, and at what times.

Though the FedEx decision only applies to Oregon and California, it is very possible that a similar decision would have been made under Nebraska law. Under the Nebraska Wage Payment and Collection Act as well as under the Employment Security Law, Neb. Rev. Stat. 48-601 et al., there is a five-part test as to whether a worker is an independent contractor or employee.

  1. Individual is free from control or direction under contract of hire
  2. Individual is free from control or direction as a matter of fact
  3. Service is outside the usual course of business for which service is performed
  4. Such service is performed outside of all the places of business of the enterprise which such service is performed
  5. Individual is customarily engaged in an independently established trade, business or profession.

Nebraska law creates a presumption of an employer-employee relationship. Tracy v. Tracy, 581 N.W. 2d 96, 7 Neb. App. 143 (Neb. Court of Appeals, 1998) In short, if you can answer most of those questions “no,” you are very likely an employee rather than an independent contractor. The mere fact that you may have signed a documents stating you are independent contractor does not necessarily mean you are an independent contractor.

In addition to protections under federal law, asking questions about your employment status is also a protected activity under Nebraska law. Being misclassified as an independent contractor could cost you thousands of dollars in wages and benefits. However, you have the ability to fight back if you are being misclassified.

Fraud

Misclassification Fraud Across the Country

North Carolina Governor Bev Perdue Signed Executive Order 125

Today’s post comes from guest author Leonard Jernigan from The Jernigan Law Firm.

“Misclassification” is a poorly chosen word to describe fraudulent conduct by employers who misclassify the status of their employees. For example, a roofing company may have 30 roofers doing the actual work but these workers are classified as “independent contractors” instead of employees. Why would they do that? At the end of the year these workers are sent a 1099 tax form that reports the wages paid, but the employer does not make any deductions for Medicare or unemployment, and doesn’t pay for workers’ compensation insurance. If you have a roofing company and you properly classify your employees, you are at a competitive disadvantage in bidding on jobs. Honest businesses are hurt by misclassification, and taxpayers are hurt because they pick up medical bills and other expenses created when one of these “independent contractors” gets hurt.

Another form of misclassification is when a construction company with 85 employees reports to its workers’ compensation insurance company that 75 of these people are staff workers, which results in a significantly reduced premium. Obviously, a construction worker is at greater risk of injury than an office worker. Again, the honest company who accurately reports the status of its employees is at a competitive disadvantage with the dishonest employer.

New York, New Jersey, Massachusetts, Virginia, Michigan, Florida, California, Texas and the vast majority of states across the country have been looking into this issue for several years and they have been aggressively prosecuting dishonest employers who try to game the system. North Carolina has finally joined these states. On August 22, 2012, Governor Beverly Perdue issued Executive Order 125, which created a task force to study this issue and try to get different agencies to communicate with each other and share information to identify employers who are failing to pay employee taxes. Hopefully, this task force will figure out how to enforce existing law. This blog will follow the progress of this task force. Stay tuned.

fighting fraud, Fraud, Insurance, Workers' Compensation

$97 Million In Fraud: 2012’s Top 10 Workers’ Compensation Fraud Cases

CFO Jeff Atwater and Broward Sheriff Al Lamberti announced multiple arrests in Operation Dirty Money.

Today’s post comes from guest author Leonard Jernigan from The Jernigan Law Firm.

Over the past few years, many states have aggressively gone after workers’ compensation fraud (whether it’s the employee or the employer) and the amount of employer fraud being discovered continues to be staggering, notwithstanding these efforts. Legitimate business owners that pay for workers’ compensation, as required by law, are at a competitive disadvantage with those who cheat the system, and when people suffer a workplace disability and have no insurance local businesses that provide goods and services feel the pain along with health care providers who cannot get properly paid for their services. The cost of medical care and disability ends up being shifted to the taxpayer through Social Security, Medicare and Medicaid, and in states where compliance is not vigorously enforced a culture of cheating continues. The top ten cases for 2012 are listed below.

2012 TOP TEN WORKERS’ COMPENSATION FRAUD CASES Total Fraud: $97,466,500.00

1. ‘Operation Dirty Money,’ Stings Workers’ Comp Fraud Check Cashing Scheme

Florida: July 27, 2012

Multiple arrests were announced in Florida’s joint task force’s ‘Operation Dirty Money,’ which led to the arrest of alleged ringleader Hugo Rodriguez, owner of the Oto Group, Inc., and seven other individuals. Mr. Rodriguez was the facilitator of 10 known shell companies that funneled in excess of $70 million in undeclared and undetected payroll through different money service businesses. By using shell companies, Rodriguez was able to run a large construction operation and avoid paying the cost of workers’ compensation coverage, leaving employees at risk and scamming legitimate businesses.

 

2. Firms Face Charges for Skipping Workers’ Comp Payments

Ohio: May 13, 2012 Thousands of Ohio companies violated state law by not paying their most recent workers’ compensation premium, which can drive up insurance costs for businesses that follow the rules, a Dayton Daily News analysis found. The bureau identified about 41,247 private employers in the state that failed to report their payroll data and submit premium payments by the deadline. As of May, more than 12,200 accounts remain outstanding, and those companies owe an estimated $5.6 million in premiums.

3. Case Proves Employee Leasing too Good to be True

Texas: July 10, 2012

$4,466,500.00 was awarded in a Texas court against a staffing agency and its workers’ compensation insurance company. Jackson Brothers Hot Oil Service hired Business Staffing, Inc., (BSI) in 1999 and required BSI to have workers’ compensation insurance for its leased employees. BSI had 150 client companies with 2,000 employees. BSI bought a policy from Transglobal Indemnity for a total premium of $4,100.00 to cover all its employees. After failing to pay the medical bills of a 27-year-old oil field worker who was in an explosion and had 18 surgeries, the employee and Jackson Brothers sued BSI and Transglobal for fraud. Neither Transglobal (who had its corporate headquarters in the Turks and Caicos Islands) nor BSI had a license to conduct insurance business in Texas.

4. Business Owner Faces Insurance-fraud Charges

California: May 2, 2012


George Osumi was indicted on numerous felony counts.

Construction business owner George Osumi of Irvine, California was indicted on numerous felony counts of misrepresenting facts to the State Compensation Insurance Fund, among other charges. From December 2001 to March of 2006, Mr. Osumi committed workers’ compensation premium fraud by reporting his payroll to SCIF at just over $1 million, under-reporting over $3.5 million in payroll. This fraud resulted in a loss of over $814,000.00 in premium owed to the insurance fund.

5. Watertown Roofing Company and its Owners Plead Guilty and are Sentenced for Labor Violations

Massachusetts: January 11, 2012


Newton Contracting Company misclassified half of its workforce as subcontractors.

The Massachusetts Insurance Fraud Bureau discovered that the company, Newton Contracting Company, Inc., owned by Shaun Bryan and Antoinette Capurso-Bryan, misclassified half of its workforce as subcontractors, as well as failing to disclose to auditors more than $3.4 million of their company’s misclassified subcontractor payroll during its annual workers’ compensation audits.

6. 7-Year Sentence in $3.1 Million Fraud Case

California: November 30, 2012

Steven Morales, 65, of Wildomar, CA was convicted and sentenced to seven years in prison for his part in a $3.1 million workers’ compensation scheme. His son Brian was also convicted and sentenced to 4 years in prison. Morales and his son had set up a sophisticated system of shell companies to hide payroll and avoid paying workers’ compensation premiums.

7. Construction Company President Accused of Payroll Fraud

Florida: March 29, 2012

Randall Seltzer, president of Navarre Industries, Inc., was charged with multiple felony counts, including workers’ compensation fraud. An investigation by Florida’s Department of Financial Services’ Division of Insurance Fraud revealed that Seltzer systematically and intentionally under-reported his corporation’s true payroll to his insurance carrier. The department’s Division of Workers’ Compensation issued the company two stop-work orders within a five-year period. Seltzer allegedly established a shell corporation in 2011 to intentionally violate the stop-work orders and continue operating his construction business illegally. If convicted, Seltzer could face up to 30 years in prison and pay over $2.8 million in restitution.

8. CFO Jeff Atwater Announces Arrest of Owner of Fake Company for Creating Fraudulent Insurance Certificates and Avoiding Millions in Premiums

Florida: April 13, 2012


Yucet Batista allegedly used a shell company to commit large-scale fraud.

Yucet Batista was arrested for allegedly creating more than 250 fraudulent certificates of insurance to help uninsured contractors avoid $2.1 million in workers compensation premiums. Batista created the company and obtained the workers’ compensation insurance policy for the purpose of “renting” it, or making it available to dozens of uninsured subcontractors for a fee.

9. Audits Uncover Almost $1.2 million in Workers’ Compensation Violations at Boston Marriott Project

Massachusetts: September 4, 2012

In 12 audits conducted by the Joint Enforcement Task Force on the Underground Economy and Employee Misclassification and the Executive Office of Labor and Workforce Development, it was discovered that there were $584,249.00 in misclassified 1099 wages and $584,287 in unreported W-2 earnings, for a total of $1,171,536.00 in unreported wages by subcontractors on the Marriot renovation project. Six companies misclassified workers as contractors rather than employees, and seven companies failed to report wages. Among the worst of the offenders were one company that misclassified 28 workers and failed to report over $410,000.00 in wages; another failed to report $462,081 in W-2 wages.

10. Inn Owners Facing Workers’ Compensation and Insurance Fraud Charges

California: June 13, 2012


Owners of the historic Brookdale Inn and Spa are facing trial on charges of falsifying wage information to obtain lower insurance premiums.

The owners of historic Brookdale Inn and Spa, Sanjiv and Neelam Kakkar, are facing trial on charges that they falsified wage information to obtain lower insurance premiums. According to records, the couple paid approximately $800,000 less in insurance premiums than they should have over a period of several years.