Ohio Investigations Result in 9 Workers’ Comp Fraud Convictions in October

November 16, 2012

The Ohio Bureau of Workers’ Compensation (BWC) announced that nine individuals were convicted of or pleaded guilty to charges related to defrauding Ohio’s workers’ compensation system during October, a result of investigations conducted by BWC’s special investigations department (SID).

A sampling of the cases that resulted in a guilty plea or conviction during October follows.

Tina Schulte pleaded guilty October 9 to one misdemeanor count of workers’ compensation fraud and two felony counts of deception to obtain a dangerous drug. SID was notified by the Clermont County Narcotics Task Force that Schulte was selling her BWC-paid narcotics during one of their open investigations. Schulte was collecting temporary total disability following a workplace injury. She admitted to selling 30 to 60 pills a month to her neighbor for $1 to $3 per pill. Schulte pleaded guilty in the Clermont County Common Pleas Court and was given intervention in lieu of a conviction.

James Palmer pleaded guilty October 22 to one misdemeanor count of workers’ compensation fraud for working while receiving benefits. SID received an anonymous tip that Palmer was working for cash under the table while collecting disability benefits. Investigators found that Palmer was working as a mechanic independently and for a local repair shop in Cincinnati. Palmer posted his mechanic services on Craigslist while receiving disability. Palmer pleaded guilty in Franklin County Common Pleas Court and was placed him on community control for five years. He was also ordered to pay restitution in the amount of $5,225.06 and to pay a minimum of $50 a month. If he violates the terms of community control, he will serve 180 days in jail.

Tammy Tschuor pleaded guilty October 4 to one misdemeanor count of workers’ compensation fraud for altering documents. SID received information from a rehabilitation supervisor who indicated that Tschuor submitted an altered doctor’s slip resulting in the receipt of three days of benefits she was not entitled to receive. Investigators found that the original doctor’s slip obtained showed Tschuor was to return to work on October 5, 2011. The altered doctor’s slip Tschuor submitted had additional information and the five had been changed to an eight. Interviews were conducted with the six receptionists at the doctor’s office who each indicated that they did not make any adjustments to the original return to work slip. Tschuor initially denied altering the slip but later pleaded guilty in Franklin County Common Pleas Court and sentenced was sentenced to time served of 13 days.

Brian Woodruff pleaded guilty October 2 to one misdemeanor count of workers’ compensation fraud for filing a false claim. SID opened an investigation after receiving an allegation that that Woodruff filed a false claim. The investigation found Woodruff did file a false claim after being accused by his employer of stealing another co-worker’s narcotic pain medication. Woodruff claimed he had a work related injury and obtained a narcotic prescription from the hospital to attempt to show his employer that he had his own prescription and did not need to steal his co-worker’s medication. Woodruff pleaded guilty in Champaign County Municipal Court and was ordered to pay $2,326.55 in fines, court costs and investigative costs. He was also sentenced to 180 days suspended incarceration and ordered to complete drug counseling.

Anibal Rivera lll pleaded guilty October 24 to one misdemeanor count of workers’ compensation fraud for working while receiving benefits. SID received an allegation from a former employer that indicated Rivera was working as a roofer while receiving disability benefits from BWC. The investigation found Rivera worked as a carpenter with Mihajlovich General Contracting and Sabo Construction Company while receiving Temporary Total Disability. Rivera pleaded guilty in Franklin County Common Pleas Court and was ordered to serve 14 days in prison, and pay court costs and a $200 fine.

Ibe Nnaji, dba Toledo Livery Service pleaded guilty October 17 to disorderly contact for misclassifying employees. The case was referred by a local competitor who suspected Nnaji did not have valid BWC coverage. Nnaji did submit a portion of his outstanding payroll reports, but the SID’s Employer Fraud Team investigation revealed Nnaji began reporting his employees as subcontractors in 2003 after reporting them as employees for several years. Nnaji’s policy lapsed in November 2007. Nnaji was audited by BWC in 2008 and placed on notice that he was improperly reporting his drivers as subcontractors. He was then billed the appropriate premiums. Nnaji’s policy remained lapsed in 2009 and he was informed he could face criminal charges if he failed to reinstate/maintain coverage. Nnaji did not comply and was charged in April 2010. Nnaji finally submitted the remaining outstanding payroll reports after being charged, but again reported his drivers were subcontractors. An additional BWC audit was conducted and auditors found that Nnaji was again improperly classifying his drivers. Nnaji pleaded to a fourth degree charge of disorderly conduct October 17 after multiple pre-trial court appearances. He was ordered to pay $13,612.92 in restitution and sentenced to 30 days in jail, suspended for five years of probation.

Keith Miller pleaded guilty October 9 to one felony count of workers’ compensation fraud for filing false wage statements. Miller was receiving Living Maintenance Wage Loss, which is available to an injured worker who has completed a rehabilitation plan but continues to have physical restrictions and experiences a wage loss upon return to work. SID received an allegation in 2010 that the wage statements Miller submitted to request compensation appeared to be suspicious. The statements had conflicting work dates and appeared to have been altered. Investigators interviewed Miller and his employer, and he ultimately admitted to altering the statement forms and submitting false payroll records in order to receive benefits. Miller was sentenced to seven months in prison, suspended for a five-year period of community control. He was also ordered to pay $30,240.31 in restitution.

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