Fraud Roundup

California correctional officer submits fraudulent workers’ comp claims
A former California Department of Corrections and Rehabilitation correctional officer has been arrested for submitting fraudulent workers’ comp claims, according to Insurance Commissioner John Garamendi.

Steve Andrew Felter, 35, was arrested on May 2 and booked into the Amador County Jail with bail set at $60,000. He was charged with seven felony counts of knowingly presenting a false or fraudulent written or oral statement in support of an insurance claim; four felony counts of knowingly making or representing a false or fraudulent statement or representation for the purpose of obtaining insurance compensation; two felony counts of knowingly failing to disclose an event that would affect a person’s right to an insurance benefit or payment; one misdemeanor count of knowingly attempting to commit a crime; and a Special Allegation which would add two years onto Felter’s sentence if he is convicted.

According to the California Department of Insurance’s (CDI) fraud investigators, while working as a correctional officer at the Correctional Training Facility (CTF) in Soledad, Felter claimed to have injured his left leg when an inmate fell onto his leg while he was attempting to break up an altercation. Felter filled out a workers’ compensation claim form and sent it to the State Compensation Insurance Fund (SCIF) for review. He stated he was unable to work and began receiving workers’ compensation benefits. Felter was cleared by a physician and returned to work.

On Dec. 11, 1998, while returning to work as a correctional officer, Felter claimed to have injured his back when he opened a roof hatch door. He requested and completed another workers’ comp claim form and received benefits until he was able to return to work.

Throughout the next six years, Felter complained to numerous treating physicians that he experienced severe pain in his left knee and low back although medical intervention did not prove any objective findings relating to his injury complaints. Felter was placed on disability.

While Felter remained off work receiving disability benefits, the California Department of Corrections and Rehabilitation’s Office of Internal Affairs (CDCR-OIA) received a “fraud tip” indicating he was performing activities contradicting his alleged disability level. CDCR-OIA’s investigation confirmed Felter was performing activities inconsistent with the level of disability that he noted to his treating physicians. Further, he was working at a Ford dealership while he was receiving vocational rehabilitation benefits to be retrained as a real estate agent.

Due to these inconsistencies on his disability, SCIF conducted a sworn deposition with Felter. During the deposition, Felter allegedly perjured himself with statements relating to his disability and physical activities. He said he was not able to perform certain activities that, in contradiction, surveillance video showed he was able to perform. He resigned from the Department of Corrections on Feb. 1, 2006, after being told he was required to return to work as a correctional officer.

As a result of Felter’s alleged fraudulent workers’ compensation claims, SCIF incurred a loss of approximately $67,000.

The continuing investigation is being conducted by the CDI Fraud Division, the CDCR-OIA, the Amador County District Attorney’s Office and CalPERS Investigations. SCIF’s Special Investigative Unit assisted in this investigation. The Amador County District Attorney’s Office is prosecuting the case.

Resident Arrested for Auto Fraud
A Twentynine Palms, Calif., resident has been charged with three felony counts of insurance fraud. Jacob Leatherberry, 32, is charged with three felony counts of insurance fraud related to a 2005 auto accident and was booked into the Morongo Valley jail with bail set at $25,000.

Leatherberry was arrested on May 10 by a detective from the Twentynine Palms Police Department and arraigned on May 12. Prosecution is being handled by the San Bernardino County District Attorney’s office. If found guilty, Leatherberry could face up to five years in prison and be forced to pay a $150,000 fine.

According to CDI investigators, on Oct. 21, 2005, Leatherberry was involved in an automobile accident in the city of Twentynine Palms. Almost one and a half hours later, he called Progressive Insurance and paid off the balance of his lapsed insurance policy — a requirement he had to fulfill before he could purchase a new policy with Progressive.

Then, while Leatherberry was purchasing a new policy with Progressive, he was asked if he was involved in any collisions in the past three years. Leatherberry replied no. He then obtained a new insurance policy that went into effect on the evening of Oct. 21, 2005. One hour later, he called Progressive to report he had been in an auto accident.

Leatherberry later admitted to CDI investigators that he purchased the insurance policy after the collision occurred.

According to Progressive, Leatherberry’s truck was a total loss. Investigators estimate that if the claim had been paid, it would have cost the insurance carrier $8,000 to $10,000. Progressive provided valuable assistance during the course of this investigation, CDI said.

Topics California