What Are the Consequences of Fraudulently Filing a Workers Comp Lawsuit?

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(Newswire.net — July 20, 2020) — Studies have shown that a small percentage of workers comp lawsuits are fraudulent. A workers comp fraud refers to the misinterpretation or lie made by an employee, provider, or employer to merit insurance proceeds. It occurs in complex and straightforward schemes that require lengthy and in-depth investigations.

Violating fraudulent and false claims state regulation can culminate in a felony charge and other dire consequences. Keep reading to understand why you should think twice before fraudulently demanding a settlement.

Criminal Consequences

According to workers compensation fraud regulations in various states, it’s a crime to do the following:

  • Deliberately make a fraudulent material representation a statement to acquire insurance awards
  • Intentionally presenting false oral or written statements against (or in support of) the claim to obtain insurance awards
  • Knowingly assisting, aiding, or soliciting an individual to acquire an insurance settlement without cause

Deceitfully filing a workers comp lawsuit makes you susceptible to felony offenses or misdemeanors. The felony charges will depend on the worth of the fraudulent cases as well as your criminal history. 

A misdemeanor sentence for a worker’s comp fraud can attract up to 12-months jail time, $150,000 fine, or twice the value of the fraudulent claims or restitution to your company or insurer.

Class C misdemeanors for false claims that yielded $50 or less could result in up to $500 penalties. 

Class B misdemeanors for deceitful claims that accrued up to $500 insurance benefits could attract a $2,000 fine and 6-month incarceration. 

Class A misdemeanors because of false allegations that yielded up to $1,500 cause fines of more than $4,000 and 12-month imprisonment.

Felony convictions for a false worker’s comp claim can lead to up to 5 years in state prison, $150,000 fine or compensation to your insurance firm or employer. 

Fraudulent allegations that resulted in benefits of between $1,500 and $20,000 will lead to incarceration for six months or 24 months. A first-degree felony will lead to a half-a-decade to a century of imprisonment.

Civil Consequences

A workers comp lawyer will warn you that conviction for a workers compensation fraud can lead to civil fines that range from $4,000 to $10,000. A civil fine can also be thrice the value of medical expenses covered by the insurer, and you have to pay an additional $4,000 for every false claim in the civil lawsuit.

Loss of Employment

Your employer will feel you have stolen their money and time, and they will resent employing you. The firm will first report the fraud to the worker’s compensation provider, and then the carrier will investigate and pass judgment. 

You illegally acquired compensation from your insurance agency, and after the establishment of your compensation fraud, the firm will terminate your employment for violating the honesty clause.

Types of Employee Compensation Fraud

Inexistent Illness or Injuries

A worker can come up with injuries or illnesses to acquire financial proceeds from an insurance service.

Exaggerated Illness or Injury

Although employees may have illnesses or injuries, they may exaggerate their condition for higher settlements.

Non-Work Related Illness or Injury

Staff can face worker’s settlement fraud charges for pretending to acquire injuries from the workplace.

How to Fight a Workers Compensation Fraud Charge

When you are accused of filing a fraudulent worker’s compensation claim, it’s crucial to consult a workers comp lawyer within the shortest time possible. You are susceptible to criminal and civil consequences for fraud charges. 

You may also serve time in prison, pay monetary fines, and lose your job. Other companies that know about your background in filing false claims will shy away from employing you. Hiring a workers comp lawyer will minimize fraud consequences.