| Winter 2008
Fraud-Fighting Corner
By Tim Riley • Manager of Special Investigations
Fraud costs the workers’ compensation system $7.2 billion a year, more than Yahoo! Inc.’s revenue in 2007, according to the National Insurance Crime Bureau.
Texas Mutual is doing its part to protect your premium dollars. In 2007, our investigators uncovered $8.6 million in fraud. That is:
- $720,000 per month
- $23,671 per day
- $986 per hour
- $16 per minute
The following cases involved a scam that investigators call double-dipping. Double-dipping occurs when claimants collect benefits for being too injured to work when they are, in fact, gainfully employed. State law requires claimants to notify their workers’ comp carrier when they return to work.
Left unchecked, double-dipping and other workers’ comp fraud scams can lead to higher premiums for all Texas employers.
Anonymous tip sparks investigation
Richard Supak of Brenham reported a job-related injury while working as a truck driver for Brenham Wholesale Grocery. He claimed he was unable to work as a result of his injury, and Texas Mutual began paying him income benefits.
Meanwhile, Texas Mutual uncovered evidence that Supak was working as a construction helper for a Burton construction company while receiving disability income benefits.
An anonymous tip provided through Texas Mutual’s Fraud StoppersSM program sparked the Supak investigation. The program offers potential cash rewards for tips that lead to arrests or indictments.
A Washington County court sentenced Supak to 12 months’ probation and ordered him to repay $1,485 to Texas Mutual. The court also ordered Supak to pay a $500 fine, plus court costs.
Travis County grand jury indicts five claimants
Five individuals were indicted, in separate cases, in Travis County on workers’ compensation fraud-related charges. The individuals allegedly collected a combined $38,357 in workers’ comp benefits they were not entitled to.
Here are the individuals who were indicted, along with the amount of benefits they allegedly collected illegally: Pamela McCoy of Splendora, $14,040; David Beatty of Flower Mound, $7,801; Michael Burnett of Graham, $7,104; Barry Davis of San Antonio, $5,969; and Michael Mora of Brownsville, $3,443.
Note: A grand jury indictment is a formal accusation, not a conviction, of criminal conduct.
In other claimant fraud news
SENTENCED— A Travis County district court sentenced Michael J. Rosenberg of McAllen to two years’ deferred adjudication and 100 hours of community service. The court also ordered Rosenberg to pay a $200 fine and repay $2,821 to Texas Mutual.
SENTENCED— A Travis County district court sentenced Felix Prado of Falfurrias to 30 days in the Travis County jail and ordered him to repay $2,791 to Texas Mutual.
We need your help
Many of our fraud investigations start when a policyholder reports suspicious activity. If you see two or more of these red flags in a claim being handled by Texas Mutual, notify us immediately at fraudstoppers@texasmutual.com or (800) 488-4488:
- Tip from a credible source
- New or disgruntled worker
- No witness to alleged injury
- Inconsistent or illogical description of incident
- Hard to contact injured worker
- Injured worker acts upset when contacted
- Suspicious injury on Monday or Friday
Fraud-fighting resources on the Web
Visit the Fighting Fraud section to read our fraud-fighting success stories, report suspected fraud, and get a Fraud StoppersSM poster for your workplace.
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