Uncovering Workers’ Compensation or Sick Leave Fraud in Los Angeles

Workers’ compensation is critically necessary because it allows workers to receive compensation due to work related injuries or illnesses.   Employees receive partial wage replacement and medical benefits. This is beneficial for employees who suddenly find themselves unable to work because they were sick or injured on the job. Even so, some employees take advantage of the benefits of workers’ comp by filing false claims. This directly impacts the employer, costs money, and can increase insurance premiums to a level so high they cannot afford the required insurance—resulting in downsizing or closing the business entirely. Insurance fraud is the primary reason employers cannot offer pay raises, bonuses, and other perks. Fraud has caused the insurance industry to become the highest non-earning company expense and the primary reason for failure in many industries, second only to over-taxation. 

Most employees in California are entitled to sick time under the Healthy Workplace Healthy Families Act of 2014. This guarantee of  paid time off allows employees to pursue medical treatment when needed. In some cases, however, this is an incentive to pretend to be sick or injured in order to receive benefits for free.

Many employees who engage in fraud form groups and actively recruit others to use the same shady doctor and attorney. They may also pull other scams, such as turning in a claim that an elective medical procedure is necessary. An employee may ask for a nasal repair of a deviated septum in the hopes of getting a rhinoplasty or “Nose Job.”  It is not unheard of for small groups of employees, in cahoots with a disreputable doctor, to claim a surgical procedure is needed, and return to work with a breast augmentation, liposuction, filler, or other purely cosmetic surgery.

Once the company has time to review the scandalous acts, the employees are usually fired, but the damage is already done and no one goes to jail (usually). The insurance company still increases the premiums to such a high level that the company suffers greatly for years to come. Worse yet, there are numerous criminal doctors and lawyers who knowingly represent and encourage this fraud because it is easy money for them. They do get caught and prosecuted, but only in the smallest percentage of cases when discovered. This is in large part due to the additional expense to pursue a prosecution. Insurance companies will even pay a claim to avoid further expense. When they see fraud, they often do nothing since they can afford to pay the claim and simply increase the insurance premium of the victimized business owner.

Some of the savviest business owners do not leave this up to the insurance company. The employer will hire a talented private investigation firm to conduct surveillance of the fraudulent claimant or claimants. Investigators often see the subjects engaging in activities they claim they cannot do. They often follow them to another job. They often see them visiting the doctor or Chiropractor for 3 minutes, just long enough to sign the sign-in sheet at the reception desk, then leave. There’s not even a real visit.

When we conduct surveillance of some doctors’ offices, we will see 10 to 50 people in one day walk in and then then leave moments later. The doctors’ records reflect a real office visit for examination or physical therapy that takes over an hour. Serious money paid to them from the insurance company. Smart employers will take the detailed court-ready report and our expert video to the insurance company and demand they do not pay the claim. Further, we can conduct employee interviews and obtain signed statements from some employees. We can assist business owners in the pursuit of proving fraud, expose the fraud and help to prosecute the bad people. This has a positive effect on the company and moral typically increases when good employees see the bad ones getting removed.

When you suspect workers’ compensation or sick leave fraud, call us at Linked Investigations for a free consultation with a licensed private investigator. We have been private investigators since 1982 and have years of experience working on cases just like yours. We can discuss your options for the best next step in protecting your business. There’s absolutely no obligation and you’ll be able to make an informed decision regarding how to proceed.

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