Investigators say that a former postal worker collected over $94,000 in workers’ compensation benefits due to a supposed workplace injury, even though she was healthy enough to play softball in several area leagues.
47-year-old Lynn Allen, of Marcy, was arraigned on five counts in federal court, including wire fraud and workers’ compensation fraud. According to medical records, Ms. Allen said she was unable to move her elbows or wrists, lift her arms above her shoulders, or grasp objects. However, according to prosecutors, she participated in several softball leagues in the Rome area while collecting these disability payments. In one instance, she allegedly played in a game only a few hours after telling doctors that she could not reach above her shoulders.
If convicted on all counts, Ms. Allen faces up to 20 years in prison and a $250,000 fine.
Authorities are quick to prosecute alleged instances of employee fraud that often involve a few thousand dollars and a misunderstanding between doctor and patient. Despite what the headlines imply, insurance agents say that double-dipping, or working while collecting benefits, is the most common fraud.
But according to a major insurance company, employer fraud costs over five times more money that employee fraud. Many times, because of the lack of oversight, companies feel that the risk of detection does not outweigh the cost savings achieved by cheating. Some of the more common employer fraud schemes include:
- Misclassification: Some employers classify most or all of their workers as “independent contractors” to avoid paying premiums.
- Incorrect Category: Other bosses claim that their workers belong in a low-risk category, like office clerks, instead of a high-risk category, like machine operators. The effect is the same, because the artificially low premium payments mean less money in the system.
- Under-The-Table Payments: An employer may offer to pay an injured worker’s expenses in exchange for not filing a claim. The result is a win-win, for the employer, that is. The premium payments do not go up, and when the promised cash fails to materialize, the claims deadline has passed and the worker receives nothing.
Injured workers are entitled to cash benefits to compensate them for economic losses, such as lost wages, medical bills, prescription drugs, and physical rehabilitation.
Undetected employer fraud costs injured workers money. For a free consultation with tenacious attorneys, contact our office. We do not charge upfront legal fees in a workers’ compensation case.