How Can Private Investigators Discover Workers Compensation Fraud?

Insurance fraud investigation is a common mission for private investigators. People get very creative when committing fraud, so private investigators need to use all their resources and ingenuity to track them and unveil their schemes.

There are several types of insurance fraud but workers compensation fraud is probably one of the most popular because it doesn’t need complicated plans and tools. Workers compensation fraud can be defined simply as the type of fraud committed by an employee to gain an advantage, money or other benefits, by exaggerating their injuries or illness suffered at work. However, contrary to what many people believe, workers compensation fraud can be committed by employers, and even healthcare providers too. Employers that commit workers compensation fraud usually underreport their payrolls or misclassify their employees to pay lower premiums while healthcare providers choose to bill for services they have never performed.

Basically, workers compensation fraud happens when someone intentionally makes a false statement or conceals information to receive benefits or prevents someone from receiving their rightful benefits. This crime alone costs the Americans 5 billion dollars annually. And yes, this affects all of us, especially since 1 in 4 Americans has no problem with defrauding insurers, and 1 in 4 construction workers are paid off the books to avoid paying premiums. Moreover, one in 10 small-business owners are concerned their employees will try to commit insurance fraud. The higher the costs incurred by insurance fraud, the higher our premiums. As a matter of fact, $1 out of every $10 spent on premiums is lost because of fraud. That is why more and more companies and individuals decide to hire a private investigator to uncover fraud.

How can private investigators help? Private investigators know how to thoroughly conduct investigations to determine whether someone is committing workers compensation fraud or not using various tools.

Surveillance

Surveillance plays an important role in a workers compensation fraud investigation. Private investigators will follow the claimant and see if their daily behavior is affected by the alleged injury or illness. Although this is a time-consuming method, surveillance proves to be a decisive factor for many workers compensation fraud investigations. The photos and/or videos taken by private investigators can prove or disprove the legitimacy of an injury. Of course, this tool can also be used to investigate employers to determine how they treat their employees.

Incident analysis

A private investigator will recreate the accident and decide if it really happened the way the employee described it. They will analyze the internal and external factors and try to find the person at fault. Private investigators will also interview witnesses and other employees to corroborate their statements and see if the facts coincide. This tactic is also used for the investigation of frauds committed by employers. Basically, the private investigator will try to understand how the accident happened and make an idea about the workplace and work environment.

Background checks

Background checks are usually conducted to determine if the employee has a history of claims and if the injury coincides with a change in employment status. If a worker has a history of attempting to win workers compensations cases in court or has such cases against multiple employers, the private investigator will be able to obtain the necessary proves that the claim is unjustified. Moreover, a background check can reveal that the employee has more than one address, especially if they’ve declared an injury and need to hide at a different address to avoid having to pretend they’re injured all the time. Private investigators can also check the criminal and civil records of the claimant, as well as their record of complaints and company filings, credit check, police incident reports, past employment history, and motor vehicle report. If an employer is suspected of committing workers compensation fraud, a private investigator can discover if the employer has a pattern of negligent employer behavior.

Since workers compensation fraud is usually accompanied by several red flags, a professional private investigator will find it easy to track the traces and unveil any fraudulent activity performed by an employee, employer or health care provider.