Trusted And Experienced
Maryland Client Advocates Since 1950

Construction company's owner tried to scam workers' compensation

One of the most ordinary workers’ compensation scams doesn’t involve workers trying to get something for nothing.

Instead, it’s the employer who tries to get away with a common ruse — they lie about who they employ, how many people they employ and what the people they employ actually do (claiming, for example, that construction workers are office staff).

According to insurance companies, these kinds of dishonest employers will put a lot of time and effort into the process, using complex financial games and false accounting processes to hide their deceptions.

While a single individual who manages to defraud workers’ comp over a bogus injury might collect a few thousand dollars, a single employer can swindle a workers’ comp insurer out of hundreds of thousands of dollars each year.

The owner of one Florida company was just nabbed for reporting fewer staff members than he actually employed, a lower annual payroll and claims that employees were engaged in less dangerous work activities — thus allowing him to avoid paying over $1 million in premiums.

For example, the owner reported a payroll of only a little more than $273,000 — instead of the $6.5 million his company payroll actually put out. That deception alone means that he cheated the insurance company of more than $1 million in premiums each year. He faces a maximum of a 60-year prison term if he’s convicted.

Lying in order to gain cheaper workers’ compensation insurance leaves the construction workers at risk of not having enough coverage for their medical bills and expenses if they’re seriously injured.

If you’ve been seriously injured and find out that your employer has played a game with the workers’ compensation insurance company, it’s wisest to explore all your legal options for recovery.

Source: Insurance Journal, “Florida Construction Company Owner Arrested for $1M Workers' Comp Scam,” Nov. 16, 2017