Bad actors continue to prey on the workers' compensation system and employers and carriers are paying the price for their fraudulent activity. New tools are being used to combat employee or claimant fraud including social networks such as Facebook.
But new data from the California Department of Insurance (CDI) show that claims administrators, suspicious employers, special investigators and others can aid in the fight by using social networks and smart interviewing techniques to uncover information that leads to prosecutions. In 2011, the Department says good information helped catch and then convict 103 individuals for various fraudulent acts in and around the workers' comp system.
The dark lining to this silver cloud is that many more cases are still going undetected. And as the 2011 convictions indicate each act of fraud is not only costly to payers -- the overall impact of fraud exceeds $1 billion annually, according to CDI estimates.