fraud

As shown by this month’s headlines, California seems to be plagued with fraud issues on the government level. Most of the fraud is allegedly being committed by government workers. The California Department of Insurance awarded $34.95 million in grants to district attorney offices across the state to help fight workers’ compensation insurance fraud. The grants were funded by employer fees and will be used to pay enforcement officials to investigate and prosecute fraud workers’ compensation system during fiscal year 2015-2016.

While the Department of Insurance was dealing with its own problems, it was discovered that California DMV workers traded cash for illegal licenses. At least 100 commercial truck drivers bribed DMV workers at $5,000/piece for trucking licenses. From 2011 to 2015, employees allegedly changed computer records to show that truck drivers passed their behind-the-wheel tests when they did not. Officials said up to 23 traffic accidents could be related to the fraud.

Fraud in California

Under the common law, fraud is generally defined as an intentional misrepresentation of existing fact made by one person to another with knowledge of its falsity and for the purpose of inducing the other person to act, and upon which the other person relies with resulting injury or damage.

Generally, you violate California’s criminal fraud statutes whenever you commit an act that results in an unfair or undeserved benefit for yourself, and/or cause harm or loss to another person. The California Penal Code addresses many types of fraud:

Car insurance fraud
Health insurance fraud
Unemployment insurance fraud
Welfare fraud
Worker’s compensation fraud
Check, credit card, and securities fraud (the 3 types of financial fraud)
Forgery and identity theft
Mail fraud
Check fraud (writing bad checks)
Foreclosure and real estate fraud

Penalties

The penalties for each individual type of fraud differ. For example, workers compensation fraud can be punished by two to five years imprisonment and a $150,000 fine. Fraud can be charged as either a misdemeanor or felony. Prosecutors typically decide this based on the amount of money involved and any prior convictions on one’s record. Continue reading