In the first Los Angeles County conviction of its kind under the state's new get-tough law on workers' compensation fraud, a jury convicted the owner of several compensation evaluation firms of bilking insurance companies out of at least $500,000.
A Superior Court jury convicted Erroll Dale Frazier, 53, late Tuesday of 17 felony counts. The panel deliberated for seven days. Its verdict marks the first conviction for the filing of claims for phony work.
Prosecutors alleged that Frazier billed insurance companies for rehabilitation that was not needed or was never performed. In some cases, they said, it was claimed for people who were not available to receive rehabilitation, such as a murder victim and an inmate in a Colorado prison. People who could not speak English were sent for computer training.
Frazier was so bold that he sued four insurance companies when they were slow to pay his bills, on the theory that the companies would rather pay than litigate, according to the lead prosecutor, Deputy Dist. Atty. Marcia Daniel.
"Every bill he sent to an insurance company was at least padded," said Daniel, who will seek a prison sentence of eight to 10 years for Frazier.
A co-defendant, Calvin Eugene Wilkerson, 37, of San Diego, pleaded guilty in San Diego County Superior Court in 1993 and testified against Frazier. Wilkerson worked for an insurance company and allegedly was a "capper" paid by Frazier to steer clients his way.
Frazier owned Frazier & Associates in Los Angeles as well as several other firms, all of which operated from a mail drop in Culver City. One of the firms was called Vocational Opportunities.
"It should have been called Billing Opportunities," Daniel said.
The case began when one of the insurance companies, American International Group Inc., became suspicious of the claims being filed by Frazier. Among other things, many of the evaluations were nearly identical, including the same misspelled words and grammatical errors.
Although prosecutions against people for submitting phony or exaggerated claims have increased in recent years, the Legislature in 1991 decided that a crackdown was needed on businesses that were thriving off the workers' compensation system. The law used in Frazier's case took effect in 1992.