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WORKERS' COMPENSATION INSURANCE FRAUD PROGRAM During the 1920s, most states, including California, accepted a new social insurance program known as workers' compensation. In California, workers' compensation insurance is a... See more » WORKERS' COMPENSATION INSURANCE FRAUD PROGRAM During the 1920s, most states, including California, accepted a new social insurance program known as workers' compensation. In California, workers' compensation insurance is a no-fault system. Injured employees need not prove the injury was someone else's fault in order to receive workers' compensation benefits for an on-the-job injury. The National Insurance Crime Bureau estimated in the year of 2000 that workers' compensation insurance fraud is the fastest-growing insurance scam in the nation, costing the industry $5 billion per year by what many people consider a victimless crime. The thievery happens in medical clinics, law offices and even your neighbor's home. Often white-collar criminals, including doctors and lawyers, have the quickest hands. Insurance companies pick up the tab, passing the cost onto policyholders, taxpayers and the general public. Hardly a victimless crime, insurance fraud is often organized crime. The increase in insurance fraud particularly during the early 1990's led many to regard insurance fraud as the crime of the 90s. Workers' Compensation insurance fraud came to the forefront as a focused insurance fraud problem in the late 1980's when people who lined up in the unemployment line in the Employment Development Department were recruited by cappers to file for workers' compensation stress claims. The problem persists, and the Fraud Division continues to focus investigative resources to combat workers' compensation fraud. The Workers' Compensation Fraud Program was established in 1991 through the passage of Senate Bill 1218 (Chapter 116). The law made workers' compensation fraud a felony, required insurers to report suspected fraud and established a mechanism for funding enforcement and prosecution activities. Senate Bill 1218 also established the Fraud Assessment Commission to determine the level of assessments to fund investigation and prosecution of workers' compensation insurance fraud. The funding comes from California employers who are legally required to be insured or self-insured. During Fiscal Year 2004-05, the Fraud Division received 6,492 SFCs, assigned 677 new cases and made 178 arrests and submitted 219 cases to District Attorneys for prosecution. Potential Loss amounted to $387,507,663. As the Workers' Compensation Fraud Program moves into Fiscal Year 2004-05, some success has been realized in turning the corner on workers' compensation insurance fraud. Difficult and long investigations are finally paying off with convictions. The number of medical and/or legal workers' compensation mills has been reduced in Southern California. Premium fraud cases have been investigated and prosecuted. From the beginning of Fiscal Year 2003-04, the CDI has participated as a member of the "Underground Economy Strike Force," per Assembly Bill 202. Participation on the Strike Force helps the Fraud Division and district attorneys investigate and prosecute the premium fraud cases which most significantly impact the California economy and business climate. Evidence suggests that the aggressive anti-fraud campaign by the Department, the district attorneys, the insurance industry and California employers continues to play a substantial role in reducing crime and helps lower workers' compensation premiums for employers statewide. District Attorneys' Workers' Compensation Fraud Program In Fiscal Year 2004-05, the district attorneys reported a total of 439 arrests, which also included the majority of Fraud Division arrests. During the same timeframe, district attorneys prosecuted 847 cases with 970 suspects, resulting in 423 convictions. Restitution in the amount of $13,019,083 was ordered on these convictions with $7,572,176 being collected during the year. The total chargeable fraud was $183,667,830 million, representing only a small portion of actual fraud since many fraudulent activities had not been identified or investigated. WORKERS' COMPENSATION CONVICTIONS Effective January 1, 2005, Assembly Bill 2866 (Frommer) enacted Insurance Code Section 1871.9 See less »

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california, fraud, insurance, investigation

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From the list : workers compensation by workcomp

Department of Insurance, fraud unit for the state of California.

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Workers' Compensation Fraud

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