Intensified efforts to fight workers' compensation fraud in Southern California
Californians receiving Workers' Compensation through fraudulent means should take note, California Department of Insurance (CDI) investigators have focused their well-trained eyes on these suspected felons and their investigations are resulting in arrests, prosecutions, prison-time and retribution.
"Much of the focus has been in Southern California given the sheer number of people and those lying to receive benefits meant to help those who truly need them," said Alan Barcelona, president of the California Statewide Law Enforcement Association (CSLEA). CSLEA represents CDI investigators, along with nearly 7,000 other law enforcement, public safety and consumer protection professionals who work for the State of California. "Workers' Compensation fraud is bad for businesses, bad for California and bad for those law-abiding employees who truly need assistance while recovering from a job-related injury. It costs all of us money."
So what are CDI investigators finding? Here are some examples of the workers' compensation cases CDI investigators have tackled over the last few months in Southern California:
Richard Rojas, 58, of Wilmington
Arrested April 24, 2014
Three felony counts of insurance fraud
Rojas claimed he was injured when he fell from the cabin of the crane he was operating. Rojas was later terminated due to poor work performance and approximately two months later filed a workers' compensation claim dated after his termination. According to department investigators, eyewitnesses stated Rojas did not fall from the crane. Rojas' claim was denied as he had not reported any injuries to his employer and the claim was dated four days after he was terminated.
John Richard Ortiz, 52, of Wilmington
Ortiz was employed as dock worker for Pro Express. He injured his lower back on May 7, 1999 when he lifted an 80 pound gate. Ortiz filed and received temporary disability payments totaling $78,220.63 over five years. In December 2004, Ortiz began to receive permanent disability payments totaling more than $250 per week.
Ortiz's wife (Diana) claimed that she was owed compensation for caring for her husband due to the extent of his limitations. Diana was awarded $150,000 retroactive pay for the care she claimed to have provided since October 2002. An investigation revealed that John Ortiz exaggerated the extent of his limitations and his wife had not provided any of the services claimed. The couple is being prosecuted by the Los Angeles County District Attorney's Office.
The total dollar loss associated with this fraud was $357,536. If convicted the couple faces jail time and $57,857.35 in restitution.
Gelacio Martinez Perez aka Gelacio Martinez, 45, of Los Angeles
In 2012 Martinez filed a workers' compensation claim against his employer, Trader Vic's Restaurant in downtown Los Angeles, for an alleged back injury. During depositions, Martinez denied filing previous workers' compensation claims against other restaurants. The department's investigation verified previous workers' compensation claims in 2004 and 2008, though Martinez continued to deny them when confronted with the facts. The Los Angeles County District Attorney's office filed felony counts of insurance fraud and attempted perjury, resulting in Martinez facing up to five years in prison and a fine of $150,000.
Larry Buckner, 59, of Los Angeles
Arrested on April 17, 2014
Buckner is accused of submitting documents that inflated mileage for physical therapy and doctor visits since 2004 by more than $25,000. CDI detectives and United States Postal Service Office of Inspector General Special Agents conducted a joint investigation that led to Buckner's arrest. Buckner faces up to five years in state prison and a fine. He will be prosecuted by the Los Angeles District Attorney's Office.
Robert Flores Jr., 42, of Van Nuys
Arrested on April 14, 2014
Flores has been charged with workers' compensation fraud for his alleged role in defrauding his insurance company out of more than $61,000. Flores was an assistant distribution center manager who allegedly sustained a lower back and neck injury on December 16, 2011, while employed by Natural Balance Foods, Inc. Flores claimed he was injured while operating a scissor lift during his shift. The investigation revealed that Flores knowingly misrepresented his physical capabilities and limitations.
Raquel Ortiz, 38, of Downey
Ortiz allegedly falsified a work-related injury she obtained when employed as a caretaker. Ortiz received more than $63,000 in temporary disability benefits during the time she was supposedly injured. The department's investigation revealed that Ortiz never rendered the services she claimed, and in fact she submitted a fraudulent "Application and Permit for Disposition of Human Remains" to collaborate her story. Additionally Ortiz is accused of perjuring herself at her deposition hearing. She was booked in the Los Angeles County Inmate Reception Center and will be prosecuted by the Los Angeles District Attorney's Office.
Marco Ordonez, 47, of Hawthorne
Arrested on April 9, 2014
Ordonez, a warehouse supervisor, claimed he suffered continuous trauma injuries to multiple body parts due to repetitive heavy lifting. Ordonez received more than $46,000 in benefits and paid expenses due to his alleged misrepresentation regarding his physical capabilities. The investigation revealed that Ordonez was working as a tax preparer while receiving workers' compensation benefits; however he had not reported any income to his insurer. The Los Angeles County District Attorney's Office filed multiple felony charges for insurance fraud.
Workers' compensation fraud is a felony. Insurers are required to report suspected fraud, as well as establish a mechanism for funding enforcement and prosecution activities. Workers' compensation fraud occurs in simple to complex schemes that often require difficult and lengthy investigations.