Definition of Fraud
In the simplest
terms, fraud occurs when someone knowingly lies to obtain
benefit or advantage or to cause some benefit that is due to be denied. If
there is no lie, there may be abuse but it is not fraud.
Employer fraud is usually committed by an employer who misrepresents the
amount of payroll or classification of employees or who attempts to avoid a
higher insurance risk modifier by transferring employees to a new business
entity rated as a lower risk category.
It is unlawful for
any employer engaged in hazardous employment to employ anyone, or receive the
fruits of the labor of any person, without first applying for workers’
compensation insurance coverage of that employee, or willfully misrepresent
their payroll information. (Hazardous employment does not include agricultural
or domestic service, railroads, or employment as a member of the clergy or as
an employee of a religious organization operating, maintaining, or conducting a
place of worship). Failure to acquire coverage or misrepresent payroll
information is a CRIME, which may be
punishable by fines and/or jail sentences.
Injured worker fraud occurs when someone
lies or willfully provides a false statement, intentionally fails to notify WSI
of work or income from work, or willfully misrepresents their physical
condition to obtain benefits from Workforce Safety & Insurance.
Provider fraud is committed by health care providers and attorneys by
inflating their bills for services or billing for treatment or services of
abuse is any practice that uses the workers’ compensation
system in a way that is contrary to either the intended purpose of the system
or the law. This includes some behavior that is not criminal and some that is,
most significantly, fraud.