Undercover Investigation Leads to Nine Arrests for Workers’ Comp Fraud in Florida

A two-day undercover operation in Manatee County focusing on unlicensed contractors that failed to provide workers’ compensation insurance, resulted in the arrests of nine men, according to CFO Jeff Atwater. The operation was conducted by the Florida Department of Financial Services’ (DFS) Division of Insurance Fraud and Bureau of Compliance, in concert with the Florida Department of Business and Professional Regulation (DBPR), Manatee County Sheriff’s office, Bradenton and Holmes Beach Police departments and the Manatee County State Attorney’s Office.

“This activity displays a blatant disregard for worker safety, and I commend this joint effort,” said CFO Jeff Atwater. “We will continue working to protect the integrity of the construction industry in Florida and make sure these fraudsters can’t put more Floridians at risk.”

As part of routine efforts to combat unlicensed activity throughout the state, investigators with the Division of Insurance Fraud and DBPR routinely monitor Internet sites, such as Craigslist and Angie’s List, to locate unlicensed scam artists. In order to protect the people of Florida from the harmful consequences of these fraudsters, investigators check advertised businesses for licensure and insurance requirements.

“Unlicensed activity is against the law and threatens the livelihood of licensed professionals who have demonstrated knowledge of the profession and have met all of the requirements prescribed by law to possess a state of Florida license,” said DBPR Secretary Ken Lawson. “Consumers should be aware of the various risks associated with doing business with unlicensed individuals and should always verify an individual’s license through DBPR prior to hiring them.”

Upon learning that several businesses within Manatee County failed to hold adequate workers’ compensation coverage, DFS began an investigation in partnership with DBPR and local law enforcement, which concluded that these same individuals were operating without being adequately licensed. Undercover law enforcement agents arranged a meeting with the alleged unlicensed workers at a local home to obtain an estimate for construction work, and upon securing a quote, the arrests were made.

Multiple subjects were arrested and now face both workers’ compensation fraud and unlicensed contracting charges.

Unlicensed activity occurs when an individual offers to perform or performs services that require a state license and the individual does not hold the required license. Florida law sets specific rules and guidelines for obtaining professional licensure, and the people who have met these requirements are held to professional standards. If convicted, they face up to five years prison time for each workers’ compensation charge, and an additional one year for a first time unlicensed contractor charge; five years if a repeat offender.

Source: Florida Department of Financial Services