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Workers’ Compensation Fraud; The Two-Part Inquiry

by | May 7, 2017 | Firm News, Workers' Compensation

Fraud in Workers’ Compensation cases can come in many forms: A misrepresentation about how the injury occurred (on vs off the job), or a person working “off the books” and failing to report earnings while receiving temporary partial disability benefits. However, in my opinion, fraud of that glaring, overt type is less common. The more common fraud alleged by workers’ compensation insurance companies is when an injured worker either fails to mention prior medical treatment or under reports the extent of prior medical treatment/injuries.

The First DCA last addressed this issue in the case of City of Hialeah v. Bono (1D16-957), where it reiterated the following workers compensation fraud two-part inquiry made by a Judge of Compensation Claims:

Workers' Compensation Fraud ; The Two-Part Inquiry

“It is illegal for any person to “knowingly make, or cause to be made, any false, fraudulent, or misleading oral or written statement for the purpose of obtaining or denying any benefit or payment” under the Workers’ Compensation Law. § 440.105(4)(b)1., Fla. Stat. (2013). And workers’ compensation benefits are barred for an employee found to have “knowingly or intentionally engaged in” such acts “for the purpose of securing workers’ compensation benefits.” § 440.09(4), Fla. Stat. (2013).

Determining that there has been a violation of section 440.105(4) requires a two-part inquiry, encompassing first a finding as to whether a false (or fraudulent or misleading) statement was made by the claimant, and second a finding as to whether, at the time the statement was made, it was made with the intent to obtain benefits. See Arreola v. Admin. Concepts, 17 So. 3d 792, 794 (Fla. 1st DCA 2009) (“In deciding this issue, the JCC had to answer two questions. The first is whether Claimant made or caused to be made false, fraudulent or misleading statements. The second is whether the statement was intended by Claimant to be for the purpose of obtaining benefits.”); see also Village Apartments v. Hernandez, 856 So. 2d 1140, 1142 (Fla. 1st DCA 2003) (“Regardless of whether the claimant was under oath, if, at the time he made any of these statements, he knew they were false . . . then the statements fall within the scope of section 440.105(4)(b)2.”)”

The first part of the two part analysis is fairly straight-forward–did the injured worker make a statement which was false? For example, if the injured worker states he/she has never had a prior back injury, but medical records establish a back injury five years ago–that is straight-forward, a false statement was made. The more difficult question to answer is, was it made for the purpose of securing workers’ compensation benefits, which the second part of the inquiry? The second part of the inquiry deals with whether the false statement or omission was made to secure workers’ compensation benefits. How is the second part evaluated? In Hillsborough Area Regional Transit v. Stuckey, OJCC Case no. 13-027186EHL, the judge stated “I then considered whether I could infer from claimant’s behavior that she had intentionally made any false, fraudulent or misleading oral or written statements or intentionally failed to reveal the existence of a prior left shoulder injury to anyone in order to obtain benefits under Chapter 440 in connection with the accident 12/7/09, or whether, instead, a reasonable person in claimant’s position would have failed to report a prior shoulder injury or condition.” In this case, the judge used a reasonable person standard. This standard is extremely fact specific to an individual case, and requires the judge to evaluate all the facts and surrounding circumstances. For example, if the statement at issue concerns treatment that was very minor, and a reasonable person could have failed to recall or mention it, that would lend to a determination the statement was not made for the purpose of securing workers’ compensation benefits. In another case involving this issue, a judge stated the following with regard to the second part inquiry:

“I accept his testimony that he simply did not remember any medical records containing back complaints and while back problems may appear in medical records, I accept the claimant’s testimony that he was never directly told that he had low back issues prior to January 20, 2015. While the claimant may be detail oriented in his work repairing automotive issues, I find that he is not a detail oriented person with his life in general. In his deposition, he did not recall how long he had been married or how long he had owned his home. In testimony before me regarding his past history, he did not dodge the questions but simply indicated under oath that he did not recall certain incidents. I do not find the claimant, in his presentation, to be so creative in order to weave a story of lies and deceit for the purpose of obtaining workers’ compensation benefits.”  Crist v. Hillsborough County Sheriff’s Office, 16-005054SLR.

In another case, the JCC stated the following with regard to the second part inquiry: “The most important factor to consider in this determination is the overall veracity of the claimant. If it is determined that the claimant’s testimony, taken as a whole, is unreliable then it would be possible for the undersigned to infer that the claimant allowed omissions of information; generally avoided answering questions; and, inaccurately described important events for the purposes of enhancing his worker’s compensation claim.”  Lively v. JVS Contracting, 15-010964EDS.  

Given the gravity of an allegation of workers’ compensation fraud: forfeiting all benefits under the Workers’ Compensation Act and possible criminal charges/fines/restitution, I highly recommend an injured worker seek the advice of counsel regarding his/her case. If you have questions regarding workers’ compensation fraud, contact our office for a free consultation with a qualified Tampa workers’ compensation attorney.