Fraud & Workers' Compensation
Barry Zalma, Esq., CFE
Arizona law, only those benefits received as a result of the
fraud must be forfeited, Arizonas Division One Court of
Appeals ruled on February 28, 2008 in the case of Alfonso
L. Obregon vs. The Industrial Commission of Arizona.
judge ruled that Arizona law required Mr. Alfonso to give up all workers comp benefits, both past and future.
The statute relied upon by the insurer, Section 23-1028(A), A.R.S., provides:
If in order to obtain any compensation,
benefit or payment under the provisions of this chapter,
either for himself or for another, any person knowingly
makes a false statement or representation, such person is
guilty of a class 6 felony, and, if the person is a
claimant for compensation, benefit or payment, he shall in
addition forfeit all right to such compensation, benefit or
payment after conviction of the offense. (Emphasis
an exercise in philology and sophistry the court concluded
that "If the legislature had intended a complete and
permanent forfeiture, it could have deleted the word "such."
In so doing the court ignored the fact that "such
compensation" modifies the words "any compensation" not
just the compensation obtained by fraud. Since the court has
difficulty parsing English sentences the Arizona Legislature
should revise the statute and the Workers' Compensation
court should consider the fact that he who presents a
fraudulent claim once sufficiently to be convicted of a
felony workers' compensation fraud would have no compunction
about committing fraud a second time.
We give effect to all provisions in the Workers' Compensation Act and preserve the intent of the General Assembly, a conviction under section 8-43-402 only requires the forfeiture of the compensation that was obtained as a result of false statements."
these holdings are correct, and I submit they are not, it
appears that in the workers' compensation venue, even if you
are caught, tried and convicted committing fraud you get to
keep those benefits you obtained fraudulently that you were
not caught committing or for which you were not convicted.
© Copyright 2007 The John Cooke Fraud Report