Once in awhile, we need to applaud the government because sometimes they get it right. Three cheers for San Diego and their approach to reduce workers’s compensation fraud. I am not referring to fraudulent claims by workers, but rather their campaign to track down employers who do not carry worker compensation coverage for their businesses.
Insurance fraud costs consumers in the United States more than $80 billion a year. Approximately $4 billion of this amount is lost to workers’ compensation fraud. As a result, states Dominic Dago, Director of Fraud Grants, “the San Diego County District Attorney’s office has an entire team dedicated to reducing WC fraud.”
There are three types of employer fraud. First, an employer may deny an injured worker benefits. In cases like this, the employer may pay workers in cash in lieu of filing a WC claim. This type of claim denial is a felony.
The second type of employer fraud is premium fraud. This is where the employer actually lies to the insurance company about the amount of payroll reported. This is also a felony.
The third type of employer fraud involves operating a business without WC insurance. This is a misdemeanor. This is probably the most prevalent type of employer fraud. Due to the state of the economy, experts expect increases in this type of fraud.
As far back as 2009, San Diego District Attorney Bonnie Dumanis launched a public awareness campaign. She placed billboards throughout San Diego County posting anti-fraud messages.
Next, the District Attorney’s office distributed WC anti-fraud posters to employers to display in the work place. The posters state that WC fraud is a felony and people go to jail for committing this crime. Apparently, there is a high demand for the posters so they expect to distribute 200,000 posters countywide. In my opinion, I have my doubts about this part of the program. Obviously, the employer that is breaking the law will not post these posters.
Next, a movie ad campaign was used to spread the anti-fraud message. They placed a series of short ads in over 340 movie screens across San Diego. The message was “Don’t do it, don’t tolerate it, report it.”
This was followed by ads in local ethnic papers, brochures mailed out to all businesses in the county and even TV commercials featuring DA Bonnie Dumanis encouraging people to report fraud.
The San Diego District Attorney encourages people to report fraud. You will remain anonymous, but people may be slightly apprehensive about doing so. Why? These other business owners may have the competitive edge over you because of their fraudulent practices. San Diego wants to “promote a competitive and fair business environment.” This will lead to lower WC rates for employers, more benefits for injured workers and a reduction of costs for consumers. Kudos to San Diego for the efforts they have put into this issue. They have been successful andhave prosecuted many cases already. You need to check with the District Attorney in your city and determine if they have a similar program.
Don’t hesitate to report someone who is committing fraud. It is the only right thing to do.
