California Insurance Code 1871.4 - Workers' Compensation Fraud
In California, workers' compensation is insurance providing medical care and payments for lost income to injured workers. Suppose you commit fraud related to workers' compensation insurance defined under Insurance Code 1871.4. In that case, you could face harsh penalties.
Simply put, workers' compensation fraud often involves providing false or misleading information to obtain benefits you are not legally entitled.
It's insurance that will pay employees for an injury or a disability occurring at work. The fraud can happen when you receive or attempt to receive payments directly related to a claim. It can also include intentionally misrepresenting or lying about an injury to obtain workers' comp benefits like lost wages and medical treatment.
Insurance Code 1871.4 says, ”(a) It is unlawful to do any of the following:
(1) Make or cause to be made a knowingly false or fraudulent material statement or material representation for the purpose of obtaining or denying any compensation, as defined in Section 3207 of the Labor Code.
(2) Present or cause to be presented a knowingly false or fraudulent written or oral material statement in support of, or in opposition to, a claim for compensation for the purpose of obtaining or denying any compensation, as defined in Section 3207 of the Labor Code.
(3) Knowingly assist, abet, conspire with, or solicit a person in an unlawful act under this section.
(4) Make or cause to be made a knowingly false or fraudulent statement with regard to entitlement to benefits with the intent to discourage an injured worker from claiming benefits or pursuing a claim.”
You can also violate this law if you encourage others to make false statements to receive benefits or submit multiple claims for the same treatment or the same injury. Let's review this law further below.
What Does the Law Say?
Simply put, workers' compensation fraud occurs when somebody provides false or fraudulent information or attempts to unlawfully manipulate the payment of benefits, including employees, employers, doctors, or other healthcare professionals.
Notably, any of the following behaviors below are considered workers' compensation fraud in California:
- Make false or fraudulent statements to obtain or deny benefits;
- False representations in support of or opposition to paying benefits;
- False statements regarding eligibility to discourage filing a valid claim;
- Conspiring with others to commit workers' compensation fraud;
- Soliciting other people to commit worker's compensation fraud.
What Are the Related Crimes?
Workers' compensation fraud is often charged along with other fraud crimes, such as the following:
- Penal Code 550 PC - Submitting Fraudulent Insurance Claims.This insurance fraud law makes it a crime for a physician or healthcare professional to file fraudulent claims for workers' compensation payment, including filing for services not provided and multiple claims for the same service.
- Penal Code 549 PC - Referring or Soliciting Business for Fraud.This law makes it a crime to willfully refer or solicit somebody to do business with an entity, knowing they are filing fraudulent claims related to workers' compensation fraud. This often involves a “kickback.”
- Penal Code 487 PC – Grand theft;
- Penal Code 470 PC – Forgery;
- Penal Code 118 PC – Perjury.
What Are the Penalties?
Suppose you are accused of violating Insurance Code 1871.4. In that case, you could be charged with a misdemeanor or felony, depending on the case details. If convicted, you face the following penalties:
- A misdemeanor carries up to one year in jail and a $1,000 fine;
- A felony carries up to two, three, or five years in state prison.
- A $150,000 fine or double the value of the fraud, whichever is greater;
- Prior convictions carry additional fines of $4000 per item or service;
- Civil penalties of up to $10,000 for each illegal claim;
- Restitution to any victims.
What Are the Legal Defenses?
If you have been accused of committing workers' compensation fraud, our California criminal defense attorneys could use various strategies to obtain the best possible outcome, as discussed below.
Maybe we can argue that you had no knowledge or intent to defraud. Recall that the prosecutor must be able to prove that you knew your statements were false actions fraudulent, which is the primary element of the crime.
Maybe we can show that you made a careless honest mistake, but there was no intent to defraud the program. The prosecutor, not the defense, has the burden of proof beyond a reasonable doubt.
Maybe we can show the prosecution that there is insufficient evidence to get a conviction. Most fraud-related cases, such as workers' compensation fraud, commonly involve long, detailed reports from doctors or other healthcare providers. professionals.
Maybe we can negotiate with the prosecutor to reduce the charges, dismiss the case, or persuade them not to file formal criminal charges prefiling (DA reject). Contact us via phone or the contact form for a free case evaluation. Cron, Israels & Stark have offices in Los Angeles, CA.
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