Employer Fraud in the Context of Workers’ Compensation

A recent story out of Miami, Florida highlights the need for closer monitoring of businesses for financial impropriety, including workers’ compensation fraud.

In this case, the owners of two local businesses — a supermarket and a tax preparation company — were arrested for such crimes as money laundering, organized scheme to defraud (first-degree felonies), multiple money service business violations (second-degree felonies), and workers’ compensation fraud (third-degree felonies).

These perpetrators were investigated by a Workers’ Compensation Fraud Task Force which discovered that one of the businesses in question operated for nearly 10 years without the required workers’ compensation coverage.  This is a third degree felony.

According to a press release, the Task Force is responsible for shutting down  “more than 30 shell companies” and identifying “$335 million in fraudulent transactions associated with these [shell] companies”.

Herndon Workers’ Compensation attorney Doug Landau wishes more states would take Florida’s lead.  “The Virginia Commonwealth Attorney’s office should crack down on businesses who are defrauding the workers’ compensation system in our country. Think of all the innocent workers who, in the end, are the ones to suffer by the actions of their unscrupulous employers.  Whenever you have have theft on such a grand level, we all lose,” says Doug.  “While those injured while unknowingly working for uninsured companies with 3 or more regular employees may get some relief from the Virginia Uninsured Employers Fund (“UEF”), calling workers “independent contractors” to avoid having to pay insurance premiums needs to be cracked down on.  Otherwise, many law-abiding Virginia citizens will find that they have no protection under the Workers Comp Act,” Landau adds.

If you or someone you know has been injured in an on-the-job accident and there are questions as to what laws apply, email or call Abrams Landau, Ltd. at once (703) 796-9555.