Texas Business Indicted on Workers’ Comp Fraud Charges

Austin-based Texas Mutual Insurance Company reported that a jury in Travis County found Ramco Group, LLC guilty of workers’ compensation fraud-related charges.

The district court ordered Ramco to pay restitution of $15,567, a $15,000 fine and court costs. The court also ordered the company to report the conviction to the Texas Department of Transportation because they were a Disadvantaged Business Enterprise.

Ramco Group, LLC out of Orange County, Texas, obtained workers’ compensation coverage through Texas Mutual from March 23, 2006, through June 24, 2007. Ramco was indicted in August 2011 for misrepresenting the payroll associated with the company.

Evidence at the trial showed that Ramco misrepresented the number of employees and payroll associated with the company by falsely representing certain drivers as independent owners and operators.

Because workers’ compensation insurance premium is based, in part, on payroll, this type of scheme results in an employer being charged a lower premium than it actually owes. By hiding payroll, an employer can gain an unfair advantage over competitors.

Source: Texas Mutual Insurance Company