LOS ANGELES — On October 28, 2020, the California Department of Insurance (CDI) announced that claims adjuster Agop Sarafian, 65, of La Crescenta and chiropractor Shahe Topjian, D.C. 65, of Granada Hills, were arrested on felony insurance fraud charges after allegedly conspiring to defraud Sarafian's employer, the State Compensation Insurance Fund (SCIF), by setting up fake workers’ compensation lien payments to receive undeserved insurance payouts of over $1.6 million.
In November 2019, another SCIF employee noted a suspicious lien payment issued by Sarafian and advised a SCIF special investigator regarding the concern. SCIF initiated an investigation and discovered that Sarafian had processed 459 lien payments to Topjian over a period of 12 years. SCIF referred the case to CDI for further investigation. A lien is often submitted by a physician or provider for payment that they believe they are entitled from a claimant’s workers’ compensation treatment or for services rendered.
The Department’s investigation, dubbed Operation Lien on Me, revealed Sarafian created and approved 459 lien payments for Topjian between 2007 and 2019. Sarafian and Topjian are accused of conspiring in this organized fraud scheme to repeatedly defraud SCIF by setting up fake workers’ compensation lien payments for services that were never provided. Sarafian allegedly used information from past State Fund workers’ compensation claims he worked on to create the fraudulent lien payments.
“This case is yet another example of the important role that state investigators have in combatting insurance fraud in California,” said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona. “Funds meant to help workers who have been injured on the job are not meant to be tapped into by fraudulent individuals who look at it as their own personal piggy bank.”
“These trusted professionals conspired to illegally line their own pockets for over a decade,” said Insurance Commissioner Ricardo Lara. “Their actions not only defrauded money from State Fund, but also harmed California consumers who pay for this type of fraud through higher insurance premiums. My department is committed to investigating fraud to protect consumers and ensure systems designed to protect them are not misused.”
The fraudulent lien payments contained no supporting documentation that Topjian provided treatment or procedures to any of the 459 claimants. Sarafian processed the lien payments under his $5,000 approving authority limit to avoid outside approval. The payments from SCIF were sent to Topjian and a portion was given to Sarafian, though neither of them was entitled to receive any of the payments. Their alleged fraud resulted in a $1,603,340 loss to State Fund. Sarafian resigned from State Fund in December 2019.
The Los Angeles County District Attorney’s Office is prosecuting this case.