BWC Investigations Result in 12 Workers’ Comp Fraud Convictions in January

Ohio Bureau of Workers’ Compensation (BWC) announced 12 individuals were convicted of, or pleaded guilty to, charges related to defrauding Ohio’s workers’ compensation system in January. The court actions are the result of investigations conducted by BWC’s special investigations department (SID). The department works to deter, detect, investigate and prosecute workers’ compensation fraud.

“As several of our recent actions show, fraud can take many forms, including businesses that put their employees at risk by not complying with workers’ compensation law,” said Buehrer. “These efforts not only protect employer premiums that are intended to support Ohio’s injured workers in their time of need, we believe talking publicly about these cases has a deterrent effect by showing our seriousness about putting an end to fraud.”

A sampling of the cases that resulted in a guilty plea or conviction during January follows.

Chuck Longbrake, dba Longbrake Demolition, pleaded guilty to one misdemeanor count of workers’ compensation fraud for altering his coverage certificate. SID received a tip from a client of Longbrake Demolition that claimed to have received a copy of a certificate from company owner Chuck Longbrake with questionable coverage dates. The source had contacted BWC to verify Longbrake Demolition’s BWC coverage and was advised coverage lapsed due to non-payment of premiums. The employer fraud team interviewed company owner Chuck Longbrake, who admitted to altering the certificate in an attempt to secure payment for a job the business completed. Longbrake Demolition’s client required proof of BWC coverage before releasing payment for work. BWC certificates include the name of the current BWC administrator, but the certificate in question contained the name of a past administrator who did not hold the office during the coverage dates listed on the altered certificate. Longbrake was sentenced to 30 days jail, suspended if court costs are paid in full by July 1. Prior to sentencing, Longbrake made a payment of $3,451.97 toward his balance of $15,590.59.

Randall and Linda Beach, DBA Beachy Cabinet pleaded guilty to charges related to their failure to maintain workers’ compensation insurance coverage to protect their employees in the event of accidents or injuries. SID began investigating after receiving a referral from the Ohio Department of Taxation that Beachy Cabinet Company, owned and operated by Linda and Randall Beachy, was operating a business without the required BWC coverage. The employer fraud team attempted to work with the pair on multiple occasions to bring them into compliance. However, they still failed to make any payments or enter into a payment plan to reinstate the BWC policy. On Jan. 3, Randall Beachy pleaded guilty to two felony counts of workers’ compensation fraud, and Linda Beachy pleaded guilty to four misdemeanor counts of attempted workers’ compensation fraud. Sentencing is scheduled for Feb. 21.

Alan Fosnight, DBA Colonial Rubber pleaded guilty to a misdemeanor count of failure to comply for allowing his workers’ compensation insurance policy to lapse. SID’s employer fraud team received an internal tip indicating Fosnight, owner of Colonial Rubber, continued to operate without the required BWC coverage. BWC’s employer compliance department previously sent multiple compliance letters to Fosnight, and he acknowledged he was operating a business in violation of state law requiring coverage. SID investigators also made several failed attempts to work with Fosnight in an effort to bring the business back into compliance. Fosnight was ordered to pay court costs and was given a 90 day suspended jail sentence with the stipulation he come into compliance within a reasonable amount of time. Prior to the plea deal, Fosnight paid approximately $9,900 towards his current balance of $126,283.21. Additional actions will be pursued if he does not come into compliance within 90 days.

Bryan Primmer pleaded guilty Jan. 24 to one misdemeanor count of workers’ compensation fraud for working while receiving benefits. SID opened an investigation after receiving an allegation that Primmer was working as a school bus driver for Logan Schools while receiving temporary total disability compensation. Investigators were able to confirm Primmer was a bus driver while concurrently receiving compensation. Primmer was sentenced to 180 days in jail, suspended for a two-year period of community control. He was also ordered to pay restitution in the amount of $2,744.85 and investigative costs of $983.81, in addition to $50 for court costs.

Jorge Banegas was convicted of a misdemeanor count of workers’ compensation fraud for working while receiving benefits. SID’s intelligence unit performed a cross match with the Ohio Department of Job and Family Services identifying that wages were reported to Jorge Banegas during the same time period he was receiving temporary total disability benefits. Investigators obtained employment records from two employers that verified Banegas was working while concurrently receiving those disability benefits. Banegas later admitted to illegally working for both companies. Banegas was ordered to pay restitution in the amount of $1,195.15, and was sentenced to 180 days in jail, suspended, and 18 months of community control.

Luis A. Toro pleaded guilty to one felony count of workers’ compensation fraud Jan. 16 for working while receiving benefits. SID received a tip on its fraud hotline alleging Toro was working as a tow truck driver in Cleveland while collecting workers’ compensation benefits. Agents conducted numerous surveillance and undercover operations and confirmed Toro continued to work as a self-employed tow truck driver in conflict with the rules associated with the workplace injury benefits he was receiving. Toro was sentenced in the Franklin County Court of Common Pleas and was ordered to pay $16,963.71 in restitution and $3,000 in investigative costs. Toro was also ordered to nine months incarceration, suspended for five years of community control. The surveillance video is available here.

Natalie Grubb pleaded guilty Jan. 28 to a misdemeanor count of complicity to commit workers’ compensation fraud for employing an injured worker she was representing in a workers’ compensation case. SID opened an investigation after receiving an allegation that an injured worker was working for her attorney, Natalie Grubb, while receiving disability benefits following a workplace injury. Investigators found Grubb allowed an injured worker she was representing to work in her legal office as an assistant. The worker was receiving temporary total disability benefits after obtaining the legal services of Grubb in the case. The two conspired to hide the work activity and earnings so the benefits would continue. A statement obtained from the injured worker herself and interviews of former employees confirmed the injured worker’s employment with Grubb. Grubb initially denied the allegations and provided a false statement to BWC but later pleaded guilty. She paid $7,709.92 in restitution and $6,731.55 in investigative costs upfront, and an additional $500 fine imposed by the Franklin County Municipal Court.

Jason Klein pleaded guilty to one misdemeanor count of workers’ compensation fraud for operating his own business while he was supposed to be recovering from a workplace injury. BWC received a tip on its fraud hotline indicating Klein was selling equipment for natural gas pumps while he was supposed to be off work recovering from a workplace injury. A second caller alleged Klein was operating his own business called KBI Services and was hauling water, plowing snow and performing natural gas conversions. Agents’ review of bank records and interviews with witnesses confirmed that Klein knowingly owned and operated KBI Services during periods he received temporary total and living maintenance compensation. Judge Pollitt in the Franklin County Municipal Court ordered him to repay $2,040 in restitution and court costs of $250. He also received a ten day suspended jail sentence.

Source: Ohio Bureau of Workers’ Compensation