Audits and auditors can be fooled quite easily in this computer age.
The company most likley dummied up a state unemployment report, or paid employees out of two accounts etc.
Article is short, I would suggest that the fraud was uncovered when a claim occured. When an injured worker gets less in benefits the he/she expected (due to being paid part on the books part off) this sort of bad acting comes to light.
Also other tax information can be used but is not always availible right away.
A companies income tax return often shows the fraud. While the company did not tell the truth to the carrier, the company did tell uncle sam about all wages to avoid taxes.
As a CPA and part of management in an independent agency, I always shake my head at the wisdom of “business” people who will put their business and personal assets at risk to avoid WC or unemployment costs, when it only takes one disgruntled employee or ex-employee to tumble the entire house of cards. Talk about being short-sighted. I’ve also never understood cutting corners in such a way that there is no case for pure error, that the only explanation is fraud, pure and simple.
In my opinion they deserve to be caught and punished because they create higher costs for other, more honest, employers and put their own employees at risk in two cases where there are supposed to be safety nets.
How do you insurance guys feel about employers who pull this kind of stuff?
Why did it take 3 years to do a physical audit!!!
Audits and auditors can be fooled quite easily in this computer age.
The company most likley dummied up a state unemployment report, or paid employees out of two accounts etc.
Article is short, I would suggest that the fraud was uncovered when a claim occured. When an injured worker gets less in benefits the he/she expected (due to being paid part on the books part off) this sort of bad acting comes to light.
Also other tax information can be used but is not always availible right away.
A companies income tax return often shows the fraud. While the company did not tell the truth to the carrier, the company did tell uncle sam about all wages to avoid taxes.
Hope they put this firm out of business.
As a CPA and part of management in an independent agency, I always shake my head at the wisdom of “business” people who will put their business and personal assets at risk to avoid WC or unemployment costs, when it only takes one disgruntled employee or ex-employee to tumble the entire house of cards. Talk about being short-sighted. I’ve also never understood cutting corners in such a way that there is no case for pure error, that the only explanation is fraud, pure and simple.
In my opinion they deserve to be caught and punished because they create higher costs for other, more honest, employers and put their own employees at risk in two cases where there are supposed to be safety nets.