Fraud News Around the Nation

January 26, 2017
Former Washington High School Coach Pleads Guilty to Auto Glass Fraud

Brad Burmester of Vancouver, Wash., pleaded guilty to first-degree felony theft in King County Superior Court. He will serve 100 hours of community service and pay $600 in court fees; he also paid $6,569 in restitution to PEMCO.

Burmester was charged with filing false insurance claims and first-degree theft after an investigation by Insurance Commissioner Mike Kreidler’s Criminal Investigations Unit (CIU).

According to the investigation, Burmester, who operated a business called Alligator Auto Glass out of his former Kirkland home, filed 15 false claims totaling $6,569 with PEMCO Insurance for windshield or window repairs. All 15 claims were on behalf of people who were staff or parents of students at Juanita High School, where Burmester was employed as a security guard and coach. Students who park at the school are required to provide their insurance and vehicle information to receive a parking pass, and Burmester had access to that information. Burmester resigned from the school in April 2016. PEMCO started investigating the claims in March 2016 and referred the case to CIU, as required by state law.

Wildlife Violation Investigation Leads to Evidence in Kansas Insurance Fraud Case

An investigation into possible wildlife violations uncovered unrelated insurance fraud evidence that led to a recent criminal conviction in Kansas.

Lawrence E. Payne, Overland Park, was sentenced Dec. 6, 2016, to serve 30 days in jail and 24 months’ probation following the discovery of 140 pairs of collectible Nike-brand shoes. The shoes were part of an insurance fraud investigation dating back to 2013.

The case was brought by the Johnson County District Attorney’s Office and the Kansas Department of Insurance’s Anti-Fraud Division. United States Fish and Wildlife Service officials found the shoes while conducting a search warrant in Payne’s home in connection with a case involving possible unregistered big cats brought into the U.S.

The insurance department’s anti-fraud division had filed probable cause court documents for the arrest of Payne following a 2013 alleged burglary of Payne’s home. The burglary supposedly occurred while he and his newlywed wife were vacationing in Colorado. Listed as stolen during that burglary were electronic equipment worth more than $25,000, and the collectible shoes.

Payne’s insurance company determined that the electronics claims were misrepresented, since the alleged business where the equipment was supposedly purchased did not exist. The company dropped the Payne’s insurance in July 2013. However, Payne maintained that the shoes had been stolen, and he continued to pursue the case until the Wildlife Service search warrant turned up the missing shoes in his possession.

Former Washington Corrections Officer Jailed in $100,000 Workers’ Comp Scam

A former Washington state corrections officer accused of holding three jobs while claiming he was too disabled to work will serve seven days behind bars along with home detention.

John J. Grudenpleaded guilty to felony, first-degree theft in a scheme to illegally get thousands of dollars in workers’ compensation benefits. The Washington Attorney General’s Office prosecuted the case based on a Department of Labor & Industries (L&I) investigation.

Investigators videotaped Gruden jogging, as well as driving to work at the Phoenix Police Department − all while receiving disability payments of more than $100,000 over five years.

On Friday, Snohomish County Superior Court Judge Ellen J. Fair ordered Gruden to serve 45 days of incarceration − seven of them in the Snohomish County Jail, and the remainder in electronic monitoring at home in Michigan, where he now lives.

Gruden was also ordered to repay the state $100,544. If he fails to comply with any part of the sentence, he must return to Washington state to serve the remainder of his confinement.

“This was a blatant case of someone trying to game the workers’ comp system, and we have the video and records to prove it,” said Elizabeth Smith, assistant director of L&I’s Fraud Prevention & Labor Standards.

Gruden injured his ankle and foot during training in May 2011, while serving as a correctional officer at Monroe Correctional Complex.

That August, he moved to Arizona, where he signed official forms and told L&I vocational counselors that his on-the-job injury prevented him from working, and that he wasn’t employed. His declarations, coupled with physician confirmations, allowed Gruden to receive L&I payments to replace part of his wages.

An L&I claim manager later requested surveillance to check on the extent of Gruden’s abilities and injuries. Investigators discovered Gruden had been working as a security professional in Arizona for nearly the entire time he told L&I he wasn’t employed.

From the fall of 2011 to early 2016, Gruden worked at a private security firm, at Maricopa County Community College, and, finally, as a full-time police officer assistant/municipal security guard for the Phoenix Police Department.

Gruden was taken into custody this afternoon to begin serving his jail time.

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