What is Workers’ Compensation Fraud?

Most people have some understanding of what fraud is, and when asked, they might say, “Someone lying to get something they didn’t deserve.” But what does fraud mean in the workers’ compensation landscape? What is needed to prove workers’ compensation fraud? And what can an employer or employee do when they suspect someone is committing work comp fraud?

What is workers’ comp fraud?

Workers comp fraud is an inaccurate or fabricated claim made by an employee, employer, or provider in order to benefit financially. This can include lying about an injury, exaggerating the severity of an injury, or misclassifying employees. Workers’ comp fraud cases can eat up resources through lengthy investigations and increase business owners’ premiums. 

An example of workers’ compensation fraud

Claimant fraud occurs when an employee makes a false claim of injury or makes a material misrepresentation that would impact the claim.

Some examples of this would be if an employee claims an injury arising from their employment when they weren’t injured at all. Or this employee was injured away from the workplace, or, not as injured as they claim to be.

There are required elements that must be proven in order to allege that workers’ compensation fraud occurred. You need the intent to tell a lie, and that lie results in a benefit they would not have received if not for that lie being told. Additionally, and very importantly, you need proof that the lie occurred. A lie alone without evidence is not enough. Evidence includes a lie on record, like in a deposition, and witness testimony and good video surveillance.

What can an employer do to protect their business from fraudulent claims?

ICW Group encourages employers to immediately investigate upon notice of an injury. Investigations might include:

  • Taking statements of witnesses
  • Taking photos of the accident site
  • Collecting any area surveillance of the job site where the alleged accident took place

Any information collected can be considered evidence. We’ve got a five-part workers’ comp fraud investigation series that offers information and resources to help identify and report on fraudulent claims in the workplace.

If a fake claim is suspected, insureds should report work comp fraud to our anti-fraud hotline, 855-ICW-FRAUD (855-429-3728), which allows individuals to report suspicious workers’ compensation claims directly to our Special Investigations Unit team, even anonymously.

ICW Group policyholders also have access to free anti-fraud collateral and resources to help educate themselves and their employees about the risks of committing fraud.

Teena Barton
Teena Barton
Teena is a Major Case Investigator with expertise in capping and organized crimes in healthcare fraud, collaborating with Insiders, and specializing in victimology. She was featured in a nationally covered story by Reveal News and NPR radio called “Billion Dollar Scam.” She is a national speaker and collaborates with an attorney convicted of selling clients to surgeons and who had a role in creating one of the most prolific organized capping schemes in US history to help inform the public. Teena is a former Police Officer/Criminal Investigator and a military veteran, having served during the Persian Gulf War, in Desert Storm/Desert Shield for the US Air Force. She is a Cum Laude graduate of Texas Christian University.

Related Articles

Eight Steps Retailers Can Take to Minimize Shrinkage

Stopping or reducing shrinkage in retail is a critical concern for businesses as it directly impacts profitability. Shrinkage refers to the loss of inventory due to factors such as...

Slip and Fall Fraud Schemes and How to Recognize Them

Slip and fall fraud schemes are deceptive practices where individuals purposely stage or exaggerate accidents in public or private spaces to file fraudulent insurance claims or lawsuits seeking financial...

Detecting Deception During an Interview

ICW Group’s Special Investigations Unit (SIU) is comprised of experts in fraud investigation and identification. We leverage this expertise to interview parties involved in a questionable workers' compensation claim.  Detecting...