Auto mechanic owes BWC $132,000 for workers’ comp fraud

Former construction worker ran auto repair shop out of his home

perezA Southern Ohio man who collected injured workers’ benefits for four years while running an automobile repair shop out of his residence must pay $132,239 in restitution to the Ohio Bureau of Workers’ Compensation (BWC) and serve five years probation.

Manuel Perez, 59, of West Portsmouth in Scioto County, pleaded guilty Monday, Nov. 21, in the Franklin County Court of Common Pleas to misdemeanor counts of workers’ compensation fraud and theft. He paid $10,000 toward his restitution to BWC at his sentencing. He also was sentenced to six months in jail, which was suspended so long as he complies with the terms of his probation.

“This case took four long years to investigate and prosecute, and I’m proud our investigators pushed it forward,” said BWC Administrator/CEO Sarah Morrison. “Mr. Perez’s restitution will go where those funds rightfully belong – caring for injured workers and creating safer workplaces across this state.”

BWC’s Special Investigations Department (SID) got a tip in November 2012 that Perez was working for his own business, M A Perez Enterprises, as a mechanic while filing an application for permanent total disability benefits from BWC. The source reported that Perez was able to crawl underneath vehicles, push and pull equipment and use wrenches to repair vehicles.

Investigators found Perez had continued to operate his mechanic’s business during a period in which he also received temporary total benefits, September 2007 to November 2011. Agents obtained bank records that provided customer names and payments and receipts from an auto parts store totaling $43,000. The customers were interviewed and identified Perez as the owner/operator of the business.

Perez’s case took years to resolve as it made its way through BWC, the Ohio Industrial Commission (IC) and the court system.

Perez was injured in December 2002 while working for a construction company and was later granted injured workers’ benefits. Roughly four months after SID began its investigation in 2012, an IC hearing officer determined Perez was overpaid and had committed fraud because he operated his automobile repair business without telling BWC. Perez denied those findings and unsuccessfully appealed his case all the way to the Ohio Supreme Court.

To report suspected cases of workers’ compensation fraud, call 1-800-644-6292 or visit bwc.ohio.gov.

Driving while drowsy a challenge for truckers

BWC ergonomist addresses Kentucky Trucking Association Nov. 15

By Delia Treaster, PhD, CPE, BWC Ergonomic Consultant

Drowsy driving kills.

In 2013, it caused 72,000 crashes on our nation’s highways, killing at least 800 drivers and passengers and injuring another 44,000, according to the National Highway Traffic Safety Administration. Some feel the true number of fatalities is actually closer to 6,000 deaths per year.

Drowsy driving is of particular concern to the trucking industry, and that’s why I presented “Shift Work, Circadian Rhythms, and Sleep” to the Ohio Trucking Association in January this year. Some members from the Kentucky Trucking Association were in the audience and invited me to give the same presentation to their association. So with BWC approval, I packed up my PowerPoint and traveled to Louisville on Tuesday, Nov. 15.

The major points I shared with the association can apply to the rest of us, as well. The bottom line is this: Proper and sufficient sleep is critical to the quality of our lives at home and at work. Sleep deprivation impedes our work performance and threatens our health and safety. It can even cause brain damage. (More on that later.)

For truck drivers, it’s especially difficult to get a full and restful night of sleep. Irregular driving hours (often dictated by delivery schedules), lack of sufficient truck stops en route, and hours-of-service rules that don’t align with real world demands are some of the factors that can disrupt circadian rhythms and interfere with sleep. (Circadian rhythms are physical, mental and behavioral changes that follow a roughly 24-hour cycle, responding primarily to light and darkness in an organism’s environment.)

circadian-rhythms

Compounding the problem of sleep loss are electronic devices that emit blue light, such as laptops, tablets and smart phones. The wavelength of blue light has a strong inhibitory effect on the production of melatonin, the sleep hormone. Too much blue light at night and the amount of melatonin secreted in the brain drops dramatically. This leads to either poor sleep (with lots of night-time waking) or a delay in the sleep cycle, causing you to fall asleep later. Either way, it results in less sleep.

microsleepIf you’re sufficiently sleep deprived, you will fall asleep, whether it’s the middle of the day or the middle of the night. This is because your brain simply shuts off, no matter the situation. It might be just an instance of “microsleep,”  a very short sleep episode lasting one to 30 seconds. Now imagine what that instance of microsleep can cause when you’re behind the wheel of a 40-ton 18-wheeler, or even a Subaru, for that matter, traveling at 70 mph.

People don’t know when they microsleep – indeed, you can microsleep with your eyes open! And you have no control over it. Just know that no amount of willpower, motivation, or training can overcome the effects of sleep deprivation.

Now, about that brain damage. Long term effects of chronic sleep loss can cause permanent brain damage. It turns out that sleep is essential for some basic brain housekeeping. Neurotoxins are removed during sleep – and only during sleep. Sleep loss means those neurotoxins accumulate in the brain, and that leads to neuron loss. Research has shown that sleep loss causes permanent and irreversible brain damage in mice.

Truck drivers aside, many people who work non-traditional hours (outside the hours of 6 a.m. to 6 p.m.) face serious disruptions to their circadian rhythms, making it hard to get a good night’s sleep. So protect your health, your brain, and stay safe on the roads by getting enough sleep! That’s seven to eight hours for most people every night. Also, be sure to avoid caffeine and electronic devices late at night.

One or two nights of insufficient sleep aren’t too bad – we’ve all been there – but don’t make a habit of it. Just be sure to make up your “sleep debt” as soon as possible.

Delia Treaster joined BWC’s Division of Safety and Hygiene in November 2013. She holds a master’s degree in human factors engineering and a Ph.D. in occupational biomechanics.

Another type of BWC certificate: Showing our appreciation to yet another employer source

By Jeff Baker, Program Administrator, BWC Special Investigations Department

Normally, when our readers think of the words “BWC” and “certificate,” they think of the BWC Certificate of Coverage. This makes sense. The certificate is widely seen and easily recognized. It is the official document employers often frame to display within their business.

Understandably, the law-abiding business owner wants every employee and customer to see that they have secured workers’ compensation coverage from our agency. They know that others see it as proof of the business’s legitimacy and a sign of the owner’s prudence.

That might explain why Vice President of Operations Philip Koster and Human Resources Generalist Lisa Lucas with the Columbus-based business MedCare Ambulance were surprised when we contacted their organization asking to present them with another type of BWC certificate: a Certificate of Appreciation.

Scott Lape, Lisa Lucas, Philip Koster and John Koehl

Scott Lape, Special Agent in Charge of the Southeast Regional Claimant Special Investigations Unit (SIU) within the Special Investigations Department (SID), explained that the certificate acknowledges the business’s referral of a fraud allegation to BWC. The referral, submitted via an online fraud allegation form, had resulted in the successful prosecution of a subject on Sept. 6.

medcare-certificateSigned by SID Director Jim Wernecke, the framed certificate is a simple way to demonstrate our thanks to MedCare Ambulance and others who are our partners in combating fraud.

Significantly, Philip Koster and Lisa Lucas received the Certificate of Appreciation from Scott Lape and Columbus SIU Fraud Analyst John Koehl during International Fraud Awareness Week (IFAW) 2016. Sponsored annually by the Association of Certified Fraud Examiners, IFAW is dedicated to the prevention, identification and investigation of fraud – wherever it might occur throughout the world.

Just like the talented and dedicated professionals with MedCare Ambulance, you are our eyes and ears in Ohio! Thank you for your help in stamping out fraud, and please, keep those tips coming. To report workers’ comp fraud to BWC, click here or call our fraud hotline at 1-800-644-6292.

Fraud funnies: Workers’ comp cheats say the darndest things

By Tony Gottschlich, Public Information Officer, BWC Communications Department

a-sid-badge-and-sealMany of us have read funny reports of the ridiculous excuses criminals give police for their illicit behavior, from, “We’re not stealing; we thought it was free,” to Winona Ryder’s, “I shoplifted to prepare for an acting role.”

Our agents in the Special Investigations Department have heard a few whoppers over the years, too. In honor of International Fraud Awareness Week, here’s a sampling. (Note: Each subject was ultimately convicted and sentenced.)

During surveillance, the claimant suspect would appear to drive as if he knew he was under investigation.  He would drive south, north and in circles before going to a job site. During the interview, I asked him if he knew he had been under surveillance. His answer was, “No, I drove that way just in case I was under investigation.”


While wearing boots and standing in wet concrete with a concrete trowel in hand, the claimant suspect stated he was only a “stock holder” in the business.


Upon commencing an interview of the claimant suspect, agents asked him if he was “Joe.” The subject replied, “No.”  He was wearing a shirt with his employer’s name and his own name on it. He confessed to his misdeeds.


A doctor was getting increasingly frustrated during an interview when he was trying to explain to Health Care Provider Team agents why he billed BWC for services not rendered. Each time he gave his “explanation,” the agent replied, “So, you billed services that were not provided.”  The doctor told the agent he was not listening and again launched into his “explanation.”  After the third or fourth round of this conversation, the agent basically restated that the services billed were not provided, but used the same made-up words the doctor had used.  The doctor smacked the table and shouted, “By God, now you’ve got it!”


We were conducting an undercover operation in a small village restaurant in Northwest Ohio to document that our subject was working as a waitress. After our subject took our food order, delivered our food and drink, she gave us our check. We paid it, gave her a tip, and showed her our credentials, asking her if she worked there. She immediately froze, stared at the badge while behind the cash register and said, “No, I ain’t workin’ here.”   Our agent replied, “We want our tip back.”

Central Ohio man faked injuries to obtain narcotics

thomas-gallagher-booking-photoA Columbus-area man with a history of faking work injuries to obtain narcotics was sentenced Wednesday to six months probation and ordered to pay the Ohio Bureau of Workers’ Compensation $620 for the cost of investigating him.

Thomas Gallagher, 47, of Dublin, pleaded guilty Nov. 16 to one first-degree misdemeanor count of workers’ compensation fraud in the Franklin County Court of Common Pleas. Besides probation, he was fined $500, with $400 suspended as long as he makes restitution to BWC.

Gallagher obtained medical treatment and narcotics on March 13 last year at a Columbus hospital after claiming he had been injured on the job while working for a local casket maker. He filed an injury report to BWC, but BWC rejected his claim after finding he hadn’t worked at the company since October 2014.

BWC’s Special Investigations Department found Gallagher pulled a similar maneuver in 2012. Gallagher filed an injury report with BWC on Feb. 15 that year, claiming he had been injured in October 2011 while working for a Speedway station. He received treatment and narcotics on Nov. 15 and Nov. 23, 2011, at a hospital in Dublin. BWC rejected the claim after Speedway reported Gallagher’s last day on the job was nearly a month prior to his alleged injury.

To report suspected cases of workers’ compensation fraud, call 1-800-644-6292 or visit bwc.ohio.gov.

Tough sanctions for roofer in workers’ comp fraud case

petrick-photoThe owner of a Sandusky roofing company who pleaded guilty to workers’ compensation fraud in September must pay nearly $27,000 in restitution to the Ohio Bureau of Workers’ Compensation and serve five years probation, according to his sentence Nov. 9 in the Erie County Court of Common Pleas.

A judge also warned Steve Petrick, Jr., that he would be jailed for six months if he fails to meet the terms of his probation. Besides monthly payments on his restitution, those terms call for Petrick to obtain and maintain full-time verifiable employment within 30 days of his sentencing. He also must obtain written permission from his probation officer before traveling out of state, and he can’t operate a motor vehicle prior to showing proof of a valid driver’s license and insurance to the Erie County Adult Probation Department.

Petrick, owner/operator of Steve Petrick Roofing, caught the attention of BWC’s Special Investigations Department after an anonymous tipster alleged he was operating his business without the required coverage.

BWC’s Employer Compliance Department attempted to assist Petrick with bringing his policy into compliance, but he claimed he had no employees and continued operating his business without coverage.

The case was forwarded to BWC fraud investigators after an injury claim was filed against the policy while the policy was lapsed. The investigation and surveillance proved Petrick Roofing had been in continuous operation with employees. Petrick again failed to come into compliance following an interview with agents.

Petrick pleaded guilty to a fifth-degree felony count of attempted workers’ compensation fraud Sept. 28.

To report suspected cases of workers’ compensation fraud, call 1-800-644-6292 or visit bwc.ohio.gov.

Man worked multiple jobs while on workers’ comp, used aliases to avoid detection

A former Campbell (Mahoning County) man who relocated to Florida was sentenced for fraud after he was discovered working while receiving workplace injury benefits, and using multiple aliases to cover his crime.

Nikitas Xipolitas, 61, pleaded guilty to a fifth-degree felony count of workers’ compensation fraud on November 4.  A judge in the Franklin County Court of Common Pleas sentenced him to six months of jail time, suspended for five years of community control, under the condition that he pay $23,601.48 in restitution the Ohio Bureau of Workers’ Compensation (BWC).

Investigators with BWC’s Special Investigations Department (SID) began looking into Xipolitas in 2010 after receiving letters from several anonymous sources alleging that Xipolitas was working as a bridge painter for several companies. The letters advised that Xipolitas worked under alias names to avoid detection.

 The investigation confirmed that Xipolitas did work on highway bridge painting projects throughout the United States for several companies beginning in July 2010. He worked under four different alias names in attempts to conceal his work activity so that he could continue receiving benefits from BWC.

Investigative unit nets 9 fraud convictions in October

One worker falls off tractor he took to bar, claims work injury

Nine Ohioans were convicted of workers’ compensation fraud in October, the Ohio Bureau of Workers’ Compensation (BWC) reported Wednesday.

“As guardians of the State Insurance Fund, we won’t tolerate the theft or misuse of injured workers’ benefits,” said BWC Administrator/CEO Sarah Morrison. “The misappropriation of those funds raises the costs of workers’ compensation coverage for everyone.”.

Malone pleaded guilty to a first-degree misdemeanor count of petty theft and agreed to pay $647 in restitution to BWC. He is scheduled to be sentenced on Dec. 13.

In Brown County in Southwest Ohio, worker Chris Owen of Georgetown filed a claim for workers’ compensation after slipping and falling from a company tractor. Owen’s employer was suspicious and reported him to BWC. Investigators determined Owen used the tractor after work hours without the owner’s permission to travel to a local bar owned by his sister. The injury occurred when he returned the tractor to his employer.

Owen pleaded no contest in Brown County Municipal Court and was found guilty of workers’ compensation fraud, a first-degree misdemeanor. A judge sentenced Owen to 180 days in jail, suspended, and one year of probation. He ordered Owen to pay BWC $2,366 in restitution.

As of Oct. 31, SID had landed 91 fraud convictions for the calendar year. Other convictions in October, starting with the most recent, include:

Tsige Kahsai, dba Boss Market, Columbus, Ohio (Franklin County) – Failure to Comply
Kahsai pleaded no contest Oct. 17 and was found guilty of one count of failure to comply, a second-degree misdemeanor, after SID found she was operating her business with at least one employee and no workers’ compensation coverage. During the prosecution process, Kahsai submitted a BWC application for coverage and obtained valid coverage. A municipal court  judge fined her $100.

Anthony Crenshaw, Columbus, Ohio (Franklin County) – Working and Receiving
SID found a database cross match with the Ohio Department of Job & Family Services indicating Crenshaw earned wages while concurrently receiving BWC benefits. Agents found Crenshaw working as a home health aide while receiving temporary total disability benefits.

Crenshaw pleaded guilty Oct. 6 to one count of workers’ compensation fraud, a first-degree misdemeanor. A county common pleas judge ordered Crenshaw to pay $10,000 restitution to BWC. That money was already on deposit with the clerk of courts at the time of sentencing. The defendant was sentenced to two days in jail, with two days of
jail-time credit. Costs and fines were waived.

Ray George, dba Spectrum Painting, Bellefontaine, Ohio (Logan County) – Lapsed Coverage
George pleaded no contest Oct. 6 to one count of failure to comply, a second-degree misdemeanor, for operating his business without workers’ compensation coverage. George was ordered to pay $336 in restitution to BWC and $100 in court costs.

O.W. White, Cincinnati, Ohio (Hamilton County) – False Wages
White pleaded guilty Oct. 5 in Franklin County Common Pleas Court to one count of workers’ compensation fraud, a fifth-degree felony. Agents discovered White’s employer closed for business in 2013, but White filed false wage statements for nearly two years after that so he could qualify for more than $27,000 in wage-loss disability benefits.

A judge found White guilty and sentenced him to community control for five years and ordered him to pay restitution of $25,000 to BWC. If White violates the terms of his community control, he must serve 12 months in prison.

Kelly Smith, Piketon, Ohio (Pike County) – False Claim
Smith pleaded guilty Oct. 4 to one count of workers’ compensation fraud, a first-degree misdemeanor, for claiming he had been injured on a job he had actually been fired from one day earlier. Smith received no benefits from the claim.

A judge sentenced Smith to 17 days in jail and ordered him to pay $672 to BWC for its investigation. Smith had 17 days of jail-time credit and had already paid the $672 at the time of sentencing. Smith had previously been prosecuted for filing a false claim in 2010.

Keith Speed, dba Speed’s Electrical Service, Columbus, Ohio (Franklin County) – False Application for Coverage
Investigators found Speed had been operating his business under lapsed status since March 2003, with several injury claims filed during the lapsed period. Agents also found his wife, Anetta Speed, had opened another BWC policy for the business without disclosing the company had a previous policy. This was an attempt to avoid past experience and debt accrued by the business. Keith Speed was convicted Oct. 4 of one count of attempted workers’ compensation fraud, a first-degree misdemeanor. A judge sentenced him to one day in jail, with credit for time served.

To report suspected cases of workers’ compensation fraud, call 1-800-644-6292 or visit bwc.ohio.gov.

International Fraud Awareness Week: Spotlight on Doug Fisher

Justice, putting bad providers out of business motivates longtime BWC fraud fighter

By Tony Gottschlich, Public Information Officer, BWC Communications Department

a-sid-badge-and-sealAs a special agent in the bureau of diplomatic security for the U.S. State Department in the 1980s and early 1990s, Doug Fisher protected royal families, foreign presidents, Nelson Mandela and U.S. Secretary of State James Baker, among others.

As a police detective earlier in his career, Fisher served on the vice and narcotics unit in High Point, North Carolina, scrubbing the streets of drug dealers, prostitutes, racketeers and other nefarious sorts.

And today at the Ohio Bureau of Workers’ Compensation, as he’s done for the last 23 years, this veteran of the Special Investigations Department (SID) pursues crooks, cheats and others who try to rip off the state’s insurance fund for injured workers.

But contrary to appearances, Fisher’s long career in law enforcement isn’t rooted in “saving the world and all that,” at least in the beginning anyway.

“I was working in a factory, and I said, ‘Hey, that looks like a job where I won’t have to get dirty,’” Fisher recalled with a slight chuckle. “I didn’t want to work in a factory anymore.”

BWC Special Agent in Charge Doug Fisher (right), of SID’s Health Care Provider Team, conducts a search warrant with Digital Forensic’s Manager Joe Lopez in Northeast Ohio earlier this year.

Fisher is Special Agent in Charge of SID’s largest unit, the health care provider team, which investigates allegations of fraud committed by medical providers, pharmacies and managed care organizations. He usually shuns the spotlight and deflects any credit he’s earned to his team, but after some arm twisting from his boss, he agreed to be featured in this article to promote SID and International Fraud Awareness Week.

“He hates the publicity, every minute of it,” said a smiling Jennifer Cunningham, SID’s assistant director and a 20-year colleague of Fisher’s. “He doesn’t go to work parties and he never wants recognized for anything. That’s just who he is, very humble.”

A Wisconsin native, Fisher joined BWC in 1993 and was one of SID’s founding members that year. The department has grown since then into a 118-member force that investigates hundreds of fraud cases a year involving workers, employers, medical professionals and others in the BWC system. In fiscal year 2016, the department’s work led to 127 convictions and $56.6 million in savings. Fisher’s team closed 51 cases, landed five convictions and identified $15 million in savings.

He said the job, though, is about more than prosecutions and protecting the State Insurance Fund.

“We knock a lot of bad providers out of the system,” Fisher said from his Mansfield office. “These are people who practice crappy medicine or no medicine at all – they’re just prescribing painkillers to people and it’s a shame.”

One recent case he’s proud of involves a chain of Cleveland-area medical clinics that was indicted Oct. 26 on racketeering and other charges related to scamming BWC out of $216,000.

A 170-count indictment returned by a Cuyahoga County grand jury accuses Dr. Stephen Bernie and an associate of billing for procedures never performed and inflating the percentage of disability for injured workers, making them eligible for higher payments from the state. Dr. Bernie is also accused of writing prescriptions for medications without examining or monitoring patients, and signing prescriptions for powerful opioids that were distributed while he was on vacation.

BWC Special Agent in Charge Doug Fisher, of SID’s Health Care Provider Team, spends much of his time in the field, but works out of the Mansfield Service Office.

Said Fisher, “Cases like that are some of the most satisfying – agents working a hard, long case that takes several years and lots of frustration and they drive it to a conclusion.”

Cunningham calls Fisher a “visionary” who looks at the big picture, studies the latest trends and enjoys outfoxing the fraudsters he’s after.

“He’s always thinking, trying to be one step ahead of the bad guys,” she said.

Fisher, 56, and his wife, Debbie, live in Northeast Ohio and are the parents of two adult children. An avid reader and long-distance runner, he also teaches criminal science part time at Stark State College in North Canton.

He said he plans to retire from BWC within the next year.

BWC investigators nab Central Ohio workers’ comp fugitive, land fraud conviction

michael-mitchell-booking-photoA Columbus-area man was sentenced for workers’ compensation fraud last week during a court appearance that was delayed after he failed to appear for his 2013 arraignment.

Michael M. Mitchell, 49, pleaded guilty to a fifth-degree felony count of workers’ compensation fraud in the Franklin County Court of Common Pleas. He was sentenced to 11 months of incarceration, suspended for five years of community control, and ordered to pay BWC $5,000 in restitution.

BWC’s Special Investigations Department (SID) received an allegation from the Claims Service Specialist managing Mitchell’s claim after she became suspicious that he may be working while receiving workplace injury benefits.  The investigation revealed Mitchell was self-employed as a painter and sub-contracted multiple jobs from various painting companies while also collecting benefits from BWC.  Investigators also determined Mitchell did not have current workers’ compensation coverage and altered his BWC certificate of coverage in order to secure painting jobs.

Mitchell was indicted by a Franklin County Grand Jury in 2013 but he failed to appear for his arraignment and a warrant was issued for his arrest.  SID’s Fugitive Task Force partnered with the Franklin County Sheriff’s office to locate Mitchell, who was taken into custody in March 2016.

To report suspected cases of workers’ compensation fraud, call 1-800-644-6292 or visit bwc.ohio.gov.