Kentucky Coal Mine Operator Charged with Workers’ Compensation Fraud

The operator of a coal-mining company in Prestonsburg, Kentucky has been indicted on charges stemming from an alleged scheme to avoid paying workers compensation insurance.

A federal grand jury in Lexington has charged Pamela Allen with five counts of mail fraud.

Allen is listed as the sole officer of Sly Branch Energy, an underground coal-mining operation. The indictment alleged that between May 2004 and May 2005, Allen underreported monthly payroll and the number of miners working for her to Kentucky Employers Mutual Insurance.

She did this by creating a sham trucking company and placing many of her mining employees on that payroll. The indictment charges that by hiding employees this way she was able to pay less than she should have for workers compensation insurance.

Her arraignment date has not yet been set.