Nailed: A fraud prevention and compliance blog

Written by Elizabeth Smith,
L&I's Assistant Director for
Fraud Prevention and
Labor Standards

Apr. 2, 2014

Prescription for prison: Bremerton man fakes work injuries, cons hospitals

News Release — March 31, 2014

A 41-year-old Bremerton man has been sentenced to 26 months in prison for defrauding hospitals to get painkillers.

Robert B. Boyer, Jr., pleaded guilty recently to 10 felony counts of fraudulently obtaining controlled substances, according to the Washington Attorney General’s Office.

51 hospital, clinic visits

Boyer was accused of making 51 visits to more than two dozen emergency rooms and urgent-care clinics throughout Western Washington to get prescriptions for Vicodin, Percocet and other painkillers.

King County Superior Court Judge Monica Benton accepted the plea last week, and ordered Boyer to serve 26 months in prison, repay the hospitals and clinics, and participate in a drug treatment program for drug offenders.

Visible cuts

A Department of Labor & Industries (L&I) investigation found that Boyer showed up with visible cuts and other injuries, seeking painkillers at emergency rooms over a three-month period starting in November 2012.

Boyer claimed he suffered the injuries while working as an ironworker, but held no such job. In addition, charging papers said, he provided false names and false Social Security numbers in an effort to open workers’ compensation claims.

$147,000 in medical bills

L&I covers medical expenses for legitimate workplace injuries. In these cases, however, Boyer left medical facilities with an estimated $147,000 in unpaid fees. The Department of Labor & Industries pays medical costs for legitimate claims, but in these cases, Boyer left hospitals to pick up the tab.

Boyer hit medical providers throughout Western Washington, from small locally owned clinics to multiple facilities in the UW Medicine, MultiCare and Franciscan health systems.

Flagrant example

As part of a plea agreement, the Attorney General’s office will dismiss 15 similar counts in Pierce County, but Boyer has agreed to also repay the hospitals in those charges. The specific amount of restitution will be determined at a hearing April 30.

"This was a particularly flagrant example of someone abusing the workers’ comp and health systems to get prescription drugs by fraud," said Elizabeth Smith, L&I assistant director of Fraud Prevention and Labor Standards. "Drug-seekers need to know our investigators will find you and hold you responsible."

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Apr. 1, 2014

Stanwood business owner gets prison time in nearly $300,000 disability fraud

News Release — March 28, 2014

A Stanwood business owner must spend a year in prison for a scam that defrauded state and federal disability programs and his union, U.S. Attorney Jenny A. Durkan announced Thursday.

Richard Stalkfleet, 66, of Stanwood, collected more than $295,000 in disability and pension benefits for eight years while running a wood chip distribution company that earned more than a half-million dollars annually, according to a news release from the U.S. Attorney’s office in the Western District of Washington.

Washington State Department of Labor & Industries investigators played a major role in uncovering Stalkfleet’s activities. They conducted surveillance of Stalkfleet, and found him working and driving trucks while receiving Social Security Disability and Teamster Pension Plan benefits and more than $130,000 in L&I workers’ compensation benefits, according to federal prosecutors.

Read more about Stalkfleet’s sentence and the L&I investigation in the U.S. Attorney’s news release at www.justice.gov/usao/waw.

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Mar. 27, 2014

Mother and daughter interpreters charged with overbilling thousands of dollars for mileage

News Release — March 18, 2014

TUMWATER — Two Mount Vernon-area interpreters, who were the Department of Labor & Industries’ top billers for mileage, face felony theft charges alleging they overbilled the state by thousands of dollars.

Gloria Mendoza Garcia, 46, and her daughter, Gloria Del Rocio Gonzalez, 31, each face one count of first-degree theft. The Washington Attorney General’s office filed the charges in Thurston County Superior Court, where the women pleaded not guilty today. Their cases were set for trial on June 9.

The women lived in separate homes and ran separate businesses in the Mount Vernon area, interpreting for Spanish-speaking injured workers at medical appointments. L&I pays for interpretation and interpreters’ mileage as part of worker injury claims.

According to charging papers, Mendoza Garcia claimed in her mileage bills that she started her trips from the address of a Seattle sports clinic. Though she told L&I investigators she had appointments there, clinic staff told investigators they didn’t recognize her.

Mendoza Garcia often billed L&I for more than 500 miles — and sometimes more than 800 miles — in the same day, charging papers said. On Oct. 17, 2012, for instance, she claimed to make five separate roundtrips from Seattle to Burlington, Mount Vernon and Sedro Wooley — trips that an investigator found would have been impossible to make in the hours she claimed.

In her mileage bills to L&I, Del Rocio Gonzalez claimed to start her trips from Marysville, more than 30 miles away from her home, charging papers said. She told investigators that the Marysville address, where she lived four years earlier, was on a billing template in her iPad, and she never changed it.

Charging papers allege Mendoza Garcia fraudulently received more than $28,000 from March 2012 through February 2013. Her daughter is accused of fraudulently receiving more than $16,000 during that period.

L&I fraud investigators discovered the irregularities while checking to see which interpreters were billing the agency the most for mileage in 2012. Garcia was at the top of the list, billing a total of $38,012.  Her daughter was second, billing $24,953.

L&I aggressively investigates fraud involving the workers’ compensation system. In 2013, nearly half of all investigations into L&I’s service providers focused on interpreters.

“If you commit fraud, the department views it as a harmful act against not only the department and injured workers, but also the taxpayers, and we will prosecute it as such,” said Annette Taylor, L&I’s chief of investigations and the provider fraud unit.

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Mar. 26, 2014

East Wenatchee man faces fraud charge in workers’ comp case

News Release – March 17, 2014

WENATCHEE – A 38-year-old East Wenatchee man faces an April 24 trial on a charge of defrauding the state of workers’ compensation benefits in a case that goes back years.

Rodimiro Cardenas Pacheco pleaded not guilty today to a first-degree theft charge in Douglas County Superior Court. He is alleged to have received more than $39,000 in cash benefits from the state Department of Labor & Industries between August 2008 and June 2011 while he was working. The Douglas County Prosecuting Attorney’s office is prosecuting the case.

“Defrauding the state costs everyone and we are committed to finding and cracking down on those who intentionally abuse the workers’ comp system,” said Elizabeth Smith, L&I assistant director for Fraud Prevention and Labor Standards. “With this case, the investigators followed up on the tips and leads and didn’t give up, and it paid off.”

The case goes back more than a decade.

According to court documents, Pacheco filed an industrial injury claim with L&I in April 2000, and began receiving medical treatment and wage-replacement payments the next year.

In 2011, L&I investigators received an anonymous tip that Pacheco was working while still receiving state benefits. The tipster claimed Pacheco wanted to eventually get an L&I pension. Utilizing information from the state departments of Licensing and Employment Security, an L&I investigator found Pacheco working in a Wenatchee orchard. Pacheco later fled the area, and the court issued an arrest warrant, court documents said.

In January, L&I investigators received another tip and found Pacheco working in an Ephrata restaurant.  They contacted police, who arrested Pacheco on Feb. 26. He is being held on $25,000 bail.

First-degree theft carries a maximum penalty of 10 years in prison plus a $20,000 fine and costs.

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Mar. 25, 2014

King County landscaper caught working while claiming he was injured pleads guilty

News release - March 7, 2014

TUMWATER — A Bothell landscaper who claimed he was suffering from an on-the-job injury has admitted to stealing state workers’ compensation benefits.

Jose De Jesus Bernal-Ruiz pleaded guilty to second-degree theft this week in King County Superior Court, according to the Washington Attorney General’s Office. The 39-year-old Bothell resident also agreed to repay the Department of Labor & Industries more than $71,000 in vocational and cash benefits he should not have received.

Judge Monica Benton sentenced Bernal-Ruiz to 30 days of jail, but allowed the time to be served through community service.

Bernal-Ruiz filed a workers’ comp claim in October 2007 after suffering a back injury while working for a Woodinville landscaper, according to charging papers filed by the attorney general.

L&I investigators determined he resumed landscape work about two years later in King County while continuing to collect vocational benefits and wage-replacement checks. 

Acting on a referral from a police task force, L&I investigators obtained cashed checks that showed Bernal-Ruiz was getting paid for landscaping, yard work and gardening from January 2010 through March 2013, charging papers said. Investigators also interviewed several of his customers, who said sometimes he worked alone and sometimes with others.

During the investigation, Bernal-Ruiz told L&I that witnesses were mistaken, and he only went to job sites to observe others working.

L&I actively investigates and penalizes those who commit fraud in the workers’ comp program. Last year, the department recovered $9.20 for every $1 invested in fighting fraud.

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