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“Sprawling” Workers’ Compensation Fraud Case in North Texas

 Posted on November 27,2015 in Uncategorized

Federal prosecutors in Dallas charged 28 federal employees and private doctors with over $8.7 million in a workers’ compensation fraud case.

According to court documents, the workers claimed they were injured on the job, the doctors fraudulently diagnosed the injuries, and claims officials received bribes and kickbacks in exchange for the approval of the disputed claims. Under the law, these workers would have been entitled to as much as 75 percent of their wages, in addition to reimbursement for medical expenses, prescription drugs, and other out-of-pocket costs. Prosecutors claim that an additional $11 million in claims might have been paid had the “sprawling corruption scheme” not been exposed.

Each of the defendants has agreed to plead guilty and each may receive up to 15 years in prison.

Employer Workers’ Compensation Fraud

Cases such as this one nearly always receive widespread media attention, fueling the myth that cheating workers routinely defraud the system. But the reality is actually far different.

Nationally, about 2 percent of employee workers’ compensation claims are fraudulent. Employer fraud, on the other hand, is rampant. In Texas, the system loses about $450,000 per year to employee fraud and over $9 million per year to employer fraud. The discrepancy is even greater in most other states, because Texas is actually quite aggressive when it comes to prosecuting these fraud cases.

Some employers routinely attempt to circumvent the system by using one of the following tactics:

  • Misclassification: A significant number of companies do not have any “employees.” Instead, the work is done by “independent contractors” or “interns.”
  • Miscategorization: Some companies classify high-risk workers, like construction worker, in a low-risk category to lower their premiums.
  • Unrecorded Payments: Some employers offer to pay injured workers’ medical bills and lost wages in cash if they agree not to file claims.

All these activities reduce the amount of money in the system, so adjusters are reluctant to pay claims in full. Injured workers are entitled to cash benefits for the lost wages and medical expenses, but it is very difficult to obtain maximum benefits without an experienced attorney.

To get the benefits that you and your family deserve, contact an experienced personal injury attorney in New Braunfels. We do not charge upfront legal fees in workers’ compensation cases.


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