WRM Security Services Inc.  

How to Identify Fraudulent Workers’ Compensation Claims

In an article written by Scott Fulmer on August 6, 2010 and posted in Pursuit Magazine- http//pursuitmag.com. Scott Fulmer is a Security and Investigation Professional and President & CEO of Scott B. Fulmer Investigations in Texas. In the article he lists and discusses the (40) most common red flags associated with fraudulent workers’ compensations claims. I think anyone in the business should be keenly aware of these common flags that are found in fraudulent claims. It is widely believed that approximately 30% of all claims involve some form of fraud. Our investigators can help you identify the possibility of fraud which will ultimately help us conduct a more effective cost efficient investigation. Below is the list of the  (40) most common fraud flags adjusters and investigators should look for when determining the possibility of a fraudulent claim.

1. There are no witnesses to the injury or the only witnesses are the
claimants “close” co-workers. Employers should install security cameras in the workplace. Installation of cameras can decrease the number of fraudulent Workers Compensation claims.

2. The claimant and witness statements offer conflicting information. Do the
statements seem rehearsed or even identical? Do they both contain the
same misspelled words? Perhaps its not a coincidence.
3. The report of the injury is not timely. Both adjusters and investigators
should advise employers to have clear and specific guidelines for
reporting work-related injuries. Supervisors should be trained to bring
accidents to the attention of management immediately.

4.  The accident  report, statements and other documents contain numerous
cross-outs, white out, erasures or are incomplete.

5.  The claimant cannot recall specific details about the accident. Along
with a selective memory loss many claimants change details of their
statement after inconsistencies have been pointed out. Employers and
adjusters should continue to question them on specifics to arrive at
what actually happened.

6. The injured worker is a new employee.  David Wylie with Texas Mutual
Insurance Company stated in Fraud No Small Matter for Small Business,
statistically the newer the employee is, the more likely the claim is
fraudulent, especially if other red flags appear.”

7.  The claimant has a poor attendance record at work Poor attendance
records have a funny way of becoming Workers Compensation claims.

8.  The claimant has a history of discipline issues along with poor
attendance. Employees who have discipline problems can become
disgruntled employees. A disgruntled employee, as Wylie pointed out
“…has a motive to fabricate the claim.”

9. The accident occurs immediately before or after a vacation Employees can
become disgruntled when their request for vacation is denied. Many
claimants view time off for a Workers Compenstaion injury as a “vacation.”

10. The accident occurs immediately prior to an employees retirement. Often
the employee will take an early retirement and may even be moving out of
the city or state. If the employer or adjuster knows the claimant is
moving this information should be relayed to the investigator
immediately.

11. The  employee is injured prior to a strike, company layoff, termination
or the employer closing or relocating the business

12.  The  employee is injured after giving notice. Nothing says thank you more
than an employee who leaves the job and is “injured” during his last few
days. This often happens with employees performing seasonal or
temporary work.
13. The employee is injured after receiving a disciplinary action, demotion,
being passed over for promotion or being placed on probation The common
denominator is that the claimant is disgruntled. Again, disgruntled
employees are more likely to file fraudulent Workers Compensation claims.

14. The  claimant has problems with workplace relationships.

15. The claimant  leaves the country for medical treatment

16. The claimant has a history of reporting subjective claims or has more
than one claim at a time.

17. The claimants job history reflects a series of jobs held for relatively
short periods of time This alone, should alert employers to potential
problems.

18. The claimants alleged injury relates to a pre-existing health problem

19. The claimant’s involved in hobbies or sports.  Claimants injured playing
sports over the weekend often attempt to blame it on a work-related
injury early Monday morning. When adjusters have claimants that are
active in sports this information should be passed on to the
investigator.

20.  The claimant is involved in home improvement or auto repair activities.

21. The claimant has a part-time job that is labor intensive, i.e. building
outdoor decks, installing tile, etc. Many claimants view Workers Compensation as a
vacation of sorts and an opportunity to get some real work accomplished.

22  The injury occurs on a Friday but is not reported until the following
Monday, or the injury happens early Monday morning or at the beginning
of a weekly shift. Probably one of the most common red flags. This could
indicate the claimant was injured over the weekend.
23. The incident report and the medical evaluation offer conflicting
information.

24. The claimant refuses or delays treatment to diagnose the injury

25. The claimant won’t come to the telephone, is sleeping and can’t be
disturbed or is never home. Again, one of the most common red flags.
Begin surveillance early at this claimants address. More than likely
he is very active.

26. The claimant misses physical therapy, occupational therapy or other
medical appointments

27. The claimant provides a telephone number but doesn’t live at the address
associated with it a variation of this is the “message phone,” where the
message taker is evasive or ambiguous when asked about the claimant.
Investigators should ask adjusters for every telephone number associated
with the claimant. Reverse the telephone numbers for the actual
addresses.

28. The claimant provides his friends, parents or other family members
address or a hotel or post office box. In other words the claimant is
hiding. Check proprietary databases and follow him from an appointment
or when he picks up his WC check from his employer.
29.  The claimants family doesn’t know anything about the claim or they are
extremely helpful to the point of the information sounding rehearsed

30. The claimant is going through a divorce

31. The claimant is going through a child custody battle

32. The claimant having financial difficulties. A fraudulent Worker Compensation claim may  be the least of your worries. This type of claimant is prone to
stealing from his employer.

33.  Tips  or anonymous information from co-workers, relatives or neighbors
suggest that the claimants injuries are exaggerated or not legitimate
Yet another reason to suggest to clients that the investigator perform
an activity check or neighborhood canvass or survey.

34. The claimants lifestyle is incompatible with his known income.These
types of claimants have their fingers in all kinds of pies and are
usually very active. Surveillance is a must.
35. The claimants family members are on workers’ comp or have a history of
claims or lawsuits.  A family that “claims” together stays together. Use
discretion when conducting surveillance and especially when making
neighborhood inquiries.
36. The  claimants injuries are subjective.This involves soft-tissue
injuries, phantom pain, emotional injuries, etc. This is very common
and difficult to prove otherwise. The best course of action is
surveillance of an active claimant over several days.
37.  The claimant changes physicians frequently.This occurs when the
physician releases the claimant to return to work or when his diagnoses
is at odds with the claimants assertions.
38.  The claimant is healthy, tanned or sunburned.The claimant is obviously
involved in outside activities. People are creatures of habit. Men
begin shaving on the same side of their face every morning. Regardless
of how careful claimants with exaggerated or fraudulent claims are, they
eventually will go back to their routines.
39. The claimant and other workers from the same employer use the same
attorney, doctor, chiropractor or clinic.

40. The  claimant is familiar with claims-handling procedures or workers’
comp rules. At the very least this could indicate that the claimant has
filed a previous claim. It also means the claimant may be expecting
surveillance. Use discretion and be careful.

It is important for employers, adjusters, and investigators to work together to identify and uncover fraudulent claims. We can help! Thank you for visiting our website. We can also be reach through our secondary website located at http://www.wrmsecurityservices.com/

Thanks

Bill S. Maseroni-Vice President -WRM Security Services Inc. Email= billjr@privateeyeli.com

Original article can be found @ http://pursuitmag.com/top-40-red-flags-which-may-indicate-workers-compensation-fraud/#ixzz118vn73tw

Works Cited:

•Ball, Jody, The Bible on Worker’s Comp Investigations. 1997, Thomas
Investigative Publications, Austin.
•Fay, John J., Encyclopedia of Security Management. 1993,
Butterworth-Heinemannn, Boston.
•Wylie, David. Fraud No Small Matter For Small Business. 2010
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