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Man Charged With Workers' Comp Fraud : Insurance: Santa Ana resident who investigators say filed a false claim last year is first in the county to be arrested under new state law discouraging exploitation.

April 23, 1993|ERIC YOUNG | TIMES STAFF WRITER

SANTA ANA — A 42-year-old Santa Ana man arrested Thursday is the first person in Orange County to be charged under a new state insurance law designed to crack down on phony claims for workers' compensation, police and insurance officials said.

The arrest followed an investigation by Fireman's Fund Insurance Co. into a claim filed last year by Gary Barnette. Barnette, formerly an employee of the Balboa Bay Club in Newport Beach, claimed that he broke his wrist while painting last September, the insurance company said.

Insurance investigators who reviewed Barnette's claim concluded that his broken wrist did not result from his job, said John Kozero, a spokesman for Fireman's Fund. He declined to elaborate on what sparked an investigator's suspicion.

About one month ago, insurance company investigators presented their findings to the Newport Beach police, who called Barnette early Thursday and arranged to meet him at the district attorney's office in Santa Ana, said Sgt. Andy Gonis.

Barnette was arrested about 11 a.m. and charged with one felony count of violating a year-old insurance code that forbids filing false workers' compensation claims. He was also charged with grand theft and attempted grand theft.

In the last few years, the state Legislature has enacted a series of reforms aimed at stopping fraud in the state workers' compensation system, which is designed to provide medical care, vocational rehabilitation and money for employees injured on the job.

Despite what Kozero described as a stepped-up effort by the state and some insurance companies to crack down on fraud, he acknowledged that there have been few arrests under the new law.

"Insurance companies have to get over their inertia of paying claims and then getting on to the next claim," Kozero said. "It's been a tendency to not pursue (suspicious) claims. . . . Unfortunately, there has been a tendency toward just paying."

Fraudulent workers' compensation claims cost the state's insurance companies hundreds of millions of dollars each year, he said.

Kozero said he hopes the arrest of Barnette will send a message to "the amateurs who would try to defraud our policyholders as well as the (so-called) mills," which are medical practices that bilk the workers' compensation system by overcharging and by performing unneeded treatment and false evaluations on scores of patients.

Barnette was being held in Newport Beach City Jail in lieu of $50,000 bail, Gonis said.

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