Workers Compensation Frauds
The Commissionís May and June 1973 public hearing and January 1974
report helped lead to a major overhaul of the workers compensation
system in New Jersey.
The SCIís investigative findings were referred to the Essex County
Prosecutor, who in 1975 obtained indictments of two partners of a law
firm and the firmís business manager in connection with bill-padding and
a phony medical treatment scheme. The indictments charged the defendants
with conspiring with certain doctors and others to submit fraudulent
reports to insurance companies. All indictments were dismissed but one,
which charged a lawyer-defendant with obtaining money under false
pretenses. Essex authorities, after being deputized in Middlesex County,
obtained a seven-count indictment from a Middlesex Grand Jury.
In addition, the New York-New Jersey Waterfront Commission enlisted the
SCIís assistance in its investigation and exposure of Workers
Compensation frauds involving dock workers in 1974-75.
Finally, three New Jersey Judges of Compensation were suspended, one of
whom subsequently was dismissed by the Governor and suspended from law
practice for six months by the New Jersey Supreme Court.
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