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Industry Insights

Grinberg: Another SJDB Voc-Rehab Outfit Charged With Fraud

  • State: California

Fraud can be tricky to deal with. 

Gregory Grinberg

Gregory Grinberg

Often enough, combating fraud can be considered in an equation form: How much money does each individual act of fraud cost, multiplied by the ability to detect said fraud? That’s why Supplemental Job Displacement Benefit voucher fraud is such a nasty animal.

The maximum exposure for the SJDB voucher fraud is $6,000 and some fraction of the $5,000 state return-to-work fund, which is replenished by employers and insurers every year. So, when an injured worker is suspected of engaging in fraud related to a voucher, the incentive for investigating and referring the case for prosecution is rarely there: What are the odds that well over $6,000 will be spent by the time the jury is empaneled?

We occasionally see some action taken against such fraud, but the individual claimants are too small a target, and the big game is the vocational rehabilitation outfits themselves.

The latest of these is the Computer Institute of Technology. As alleged, the school submitted fraudulent documents to insurance carriers for classes never actually provided. There are also allegations of forged signatures for injured workers.

If you received bills from the Computer Institute of Technology, you might consider reaching out to the Los Angeles County District Attorney’s office to see if you were billed for services that were not actually performed. 

Speaking more generally, the naysayers might claim that there is no harm to victims when such fraud occurs. After all, the voucher is for a set sum and, if issued, the insurance company was not contesting liability.

The victims of fraud are often many, and the case is true here as well. First, the injured workers are being hoodwinked out of a benefit to retrain and develop new skills.  Second, the insurers are being defrauded as well. A benefit may very well never have been used and is being exploited to line the pockets of criminals. So, this fraud does real damage, driving up costs and lowering the available resources available for benefits and wages.

I say, if you suspect voucher fraud, even if it will not be the case of the century, investigate and report it. Every bit of fraud the defense community ignores, tolerates or decides to just absorb encourages more fraud.

Gregory Grinberg is managing partner of Gale, Sutow & Associates’ S.F. Bay South office and a certified specialist in workers’ compensation law. This post is reprinted with permission from Grinberg’s WCDefenseCA blog.

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