Articles Posted in Workplace Fraud

An office setting can be rife with potential safety hazards. Yes, sitting behind a desk is definitely safer than hauling lumber at a construction site, but don’t think Boston injury accidents still don’t happen. If you were injured at the office, please contact our Massachusetts workers’ compensation law firm today. You may want to explore your options.

Common Office Accidents:

• Fall accidents are the most common kind of office accident (includes slip and fall accidents, trip and fall accidents, step and fall accidents, and other falls.) According to the Centers for Disease Control and Prevention, office workers are at least two times likely to sustain a disabling injury in this type of incident. Common causes include wet floors, poor lighting, bending or reaching for an object while in an unsteady chair, electrical cords on the ground, an open drawer, uneven flooring, objects left on the floor, or standing on a chair instead of a ladder, and dark hallways and stairwells.

The Massachusetts State Auditor has revealed that a non-profit human services provider in Western Massachusetts that serves mentally ill and emotionally disturbed children has corruptly used over $1 million in state taxpayer money. They are additionally accused of paying an employee´s workers´ compensation insurance claim with state money during a time period in which their workers´ compensation had lapsed.

In a report released by the auditor´s office, the Easthampton-based Northeast Center for Youth and Families Inc. has allegedly misused funds over a five-year period. The organization serves approximately 600 mentally ill and emotionally disturbed children in Massachusetts. The organization also operates in Connecticut.

State Auditor Suzanne Bump said, “We want to ensure that human service providers like the Northeast Center are spending public funds legally, appropriately and wisely to maximize every dollar and help the greatest number of physical and emotionally needy children, adults and families.” She described that this situation was “another side of the coin of waste, fraud and abuse.” In response to the audit´s findings, the organization responded, “It is possible that we will continue to disagree with one or more of the Auditor’s findings…In any event, we will cooperate with the Commonwealth in its prescribed process for the resolution of audits.”

Auditor Bump reported that the center sent higher cost information to the Department of Youth Services between 2006 and 2008, which resulted in an unfounded overpayment of more than $650,000 to the organization. They also allowed their workers´ compensation insurance to lapse for 21 days in 2007, during which time an employee was injured on the job and was paid $52,073 to cover medical expenses, lost wages and a settlement. In this case, the state auditors determined that the agency used over $7,000 of state funds to pay the claim. The center also reportedly improperly used $406,360 to cover out-of-state losses in Connecticut and the $1 million amount of bonuses that were given out over a three-year time period is now being reviewed by the Department of Youth Services.

A former bookkeeper for 27 years at the organization, Cecile Guilbault, commented “They’ve been doing unethical things for years…I’m glad that finally, after all these years, the state has finally caught up with them.”

Auditor Bump requested that the organization return all fraudulently used funds to the state.


State audit finds that Northeast Center for Youth and Families misspent money,, August 26, 2011
Audit: Human services provider misused $1m in taxpayer funds,, August 25, 2011
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The Office of Attorney General Martha Coakley has recently announced that Maria Oliveira-Soares, a woman from Randolph, Massachusetts, has been charged with two counts of Workers’ Compensation Fraud.

After a referral instigated by the Massachusetts Insurance Fraud Bureau (IFB), AG Coakley’s office began an investigation into Oliveira-Soares’ fraudulent claims for workers’ compensation. According to the investigation, she filed a claim for workers’ compensation in March of 2004 while working for a cleaning company for an injury on the job. She then reported numerous times that she had debilitating pain from her injuries and testified to the Department of Industrial Accidents (DIA) in August 2005 that she was not working because of these injuries sustained. She then reportedly worked for five different employers while collecting compensation and then even filed a second workers’ compensation claim for injuries while working as a nurse’s assistant in October 2005.

During this time she fraudulently collected over $15,000 in claims. A Suffolk Superior Court has arraigned Oliveira-Soares and she is due in court on June 14 for a pre-trial hearing.

Attorney General Coakley commented, “Workers’ compensation fraud puts an undue strain on many businesses leading to higher premiums that ultimately get passed down to consumers.”

If you have been injured in a work-related accident, contact one of our experienced Boston workers’ compensation lawyers for legal advice and to find out if are entitled to workers’ compensation.


Randolph Woman Arraigned in Connection with Fraudulently Collecting Over $15,000 in Disability Benefits While Working, Office of Attorney General Martha Coakley Press Release, April 15, 2011 Continue reading

The Office of Attorney General Martha Coakley has announced that John Cloutier, 46, of East Freetown, Massachusetts, is guilty of Workers’ Compensation Fraud while working for the Department of Correction. From July 2008 to March 2010, Cloutier collected workers’ compensation for a work-related injury and told medical examiners that he could not stand for an extended period of time or take part in any activities that might stress or worsen his injuries. However, it was later discovered and proven that he ran a long-distance marathon and several half-marathons during this same time period.

In March of 2010, a workers’ compensation judge at the Department of Industrial Accidents decided that he was not eligible for any workers’ compensation after his first marathon as they were given evidence that he ran long-distance races from January 2009 to September 2009. Investigations into the matter found that he wrongfully collected over $56,000 after January 2009. The Department of Correction then handed the matter over to the Attorney General’s Office for prosecution in April of 2010.

Superior Court Judge Frances McIntyre charged Cloutier with two and a half years in the House of Correction and with a probation period of five years. During Cloutier’s probation, he is not allowed to work for a public entity, he must inform any employer of his sentence, and he also must repay the entire amount of compensation that he was not eligible for after January 2009 in the amount of $56,733.

To find out if you have grounds for a workers’ compensation case or if you have been injured in the workplace, contact one of our experienced Massachusetts Workers’ Compensation Lawyers for a free consultation.


Former Correction Officer Pleads Guilty, Sentenced for Fraudulently Collecting Workers’ Compensation Benefits, Office of Attorney General Martha Coakley Press Release, March 30, 2011 Continue reading

Employers who pay workers under the table or misclassify them as contractors make up a big part of the construction and trades industry, according to a forum held at Quinsigamond Community College in Worcester, Massachusetts. Worker and business representatives met with representatives from several state agencies to discuss the Underground Economy and Employee Misclassification.

The economic reality of employers hiring subcontractors who then subcontract to others or resort to illegal hiring practices makes it difficult for construction businesses to compete in the residential market, according to David S. Klein, president of an architectural metal and roofing contractor in Worcester.

In this underground economy, some companies pay construction workers in cash so that they can save on taxes, workers’ compensation insurance, and health insurance.

A Harvard University study conducted in 2004 estimated that about 125,725 Massachusetts workers (including over 7,000 construction workers) were misclassified as independent contractors between 2001 and 2003. The study also estimated that employers could be denying the state up to $91 million in workers’ compensation payments.

Skirting of state hiring laws focus of forum
, Worcester Telegram & Gazette, September 23, 2008 Continue reading

New Hampshire contractors say that misclassification of workers among their competition has forced them to seek business elsewhere in Massachusetts. They claim that it is almost impossible for them to land construction projects in their own state because their competitors illegally misclassify workers to avoid paying for workers’ compensation, cutting their costs by about a third and allowing them to offer lower bids.

Many of these contractors have banded together to share their concerns with their local representative. A join task force is also preparing to examine the business practices of contractors throughout the state and penalize those who misclassify workers to deny them workers’ compensation.

Independent contractors generally earn more per hour, but they are cheaper for the contractor to employ because they don’t require workers’ compensation coverage. This issue was recently brought to light when a local construction worker fell on a construction site and shattered the bones in his left foot. He was originally denied workers’ compensation money because he was classified as an independent contractor.

Contractors speak up on workers comp, Nashua Telegraph, August 19, 2008 Continue reading

Mark Lay, an investment advisor in Ohio, was sentenced to 12 years in prison following a loss of $216 million by Ohio’s agency for injured workers. The forty-five year old was the Chief Executive and Founder of MDL Capital Management, which is now defunct. Lay’s sentencing was the grand finale of a three year investigation into investment scandals at the Ohio Bureau for Workers’ Compensation.

The state of Ohio invested $225 million in a hedge fund Lay set up in Bermuda. The state lost all but $9 million. Lay reportedly borrowed against the fund, which caused almost $213 million of the $216-million loss.

Lay was convicted for investment advisory fraud, mail fraud and wire fraud. Prosecutors asserted that Lay concealed information from bureau staff and took unauthorized risks. He claimed that his poor investment choices were not a criminal offense.

Massachusetts Secretary of Labor and Workforce Development Suzanne M. Bump announced last month that the state is launching a new EOLWD website and toll-free hotline, 1-877-96-LABOR, so that workers can report suspected workplace fraud activity. Attorney Michael Bradley, formerly of the Norfolk County District Attorney’s Office and the Plymouth County Sheriff’s Office, has been appointed Executive Director of the Joint Task Force to handle operational issues likes investigating tips from the hotline and website.

The goal of this new initiative is to reduce the “underground economy,” meaning employers who misclassify employees as independent contractors, do not have a workers’ compensation policy, or pay their employees in cash “off-the-books” to conceal their business activities from local and federal government. It is also aimed at claimants who collect unemployment insurance or workers’ compensation while they are actually working.

“Stamping out such fraud is a high priority of the Patrick Administration,” said Secretary Bump. “The hotline and website are ways to report wrongdoing so that we can restore fairness in our state’s economy and help those who go to work each day to earn an honest day’s wage.”

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