Fraud is just one of the many concerns of business owners. Worker’s compensation fraud is becoming more and more prevalent in the workplace, and these fraudulent claims can have a massive impact on business owners, especially small business owners.
False claims can increase the cost of premiums for a business owner, and ultimately negatively impact other employees.
False claims can increase the cost of premiums for a business owner, and ultimately negatively impact other employees. Now that you’ve learned about what worker’s compensation fraud is, learn the signs of fraud and how to stop it in its tracks — while preventing it from happening in the first place.
Common Types and Warning Signs of Compensation Fraud
In order to detect worker’s compensation fraud, it’s important to understand the warning signs and other suspicious activity that could constitute fraud. For example, an injured worker may exaggerate their symptoms, or fabricate a work-related injury entirely. How can employers tell worker’s compensation fraud is occurring? Consider the following red flags:
- Were there any witnesses to the work-related injury?
- Are there any inconsistencies to the injured person's story?
- Is the employee refusing to file a claim with their medical provider or insurance company?
- Does the injured worker have another job in which the injury could have occurred?
- Was the employee doing tasks at work outside of their regular job duties?
- Is it possible the employee could have been injured while doing a non-work-related activity over the weekend or on a vacation?
- What other recreational activities could have caused the injury?
All of these factors and more can be a predictor of fraud and should be investigated promptly.
Run Background Checks
Sometimes the best way to prevent workplace fraud is to avoid hiring unscrupulous employees in the first place. Working with reliable, trustworthy employees is key when it comes to preventing potential fraud. Hiring a private investigation firm can help you incorporate regular Background investigations into your hiring process to scan potential employees for any past criminal records, terminations or unethical behavior.
Develop a Policy Against Fraud
Developing firm policies can be your first line of defense against workplace fraud for both independent contractors, existing employees and potential employees alike. When creating your employee handbooks, be sure that your stance on fraud of any kind is clearly outlined, making it obvious that workplace fraud of any kind will not be tolerated and can result in termination. Requiring employees to sign and acknowledge company policies can decrease your likelihood of fraud.
Establish a Workplace Safety Program
Holding regular safety training meetings ensures that you are promoting a culture of safety while reminding your employees of essential best practices to avoid injury. In industries like construction or other fields that require strenuous physical labor, these policies are especially important. Worker’s compensation fraud is dangerous for a number of reasons, and it can also minimize legitimate work-related injuries for honest, hard working employees.
Worker's compensation fraud is dangerous for a number of reasons, and it can also minimize legitimate work-related injuries for honest, hard working employees.
By regularly reviewing safety practices, awarding safety milestones and consistently inspecting workplace equipment, you can protect your employees from workplace injuries and in turn, prevent suspicious injury claims.
Review your Fraud-Reporting Process
Your employees can often be your best defense against fraudulent compensation claims. How likely would they be to speak up if they witnessed employee fraud firsthand? Consider how you can change your company procedures to encourage whistleblowing. You may even consider establishing an anonymous reporting process through human resources so employees feel protected and safe to share any unethical behaviors as they happen.
Work with a Private Investigator
Worker’s Compensation fraud can be incredibly expensive. If you believe your company has fallen victim to worker’s compensation fraud, we can help. InQuest Solutions uses the most advanced technology to assist our clients, with a proven track record of results for over 20 years.
Contact us today to submit a New Case Request so we can help you with all your investigative needs.
