A person commits the Nevada crime of “workers’ compensation insurance fraud” by intentionally providing false information in order to obtain insurance benefits. There are various types of workers’ comp fraud, including:

• Applicant fraud, where an employee fraudulently tries to obtain workers’ comp benefits.
• Employer fraud, where an employer fraudulently tries to pay less workers’ comp premiums.
• Carrier fraud, where the insurance company fraudulently tries to avoid paying out benefits.¹

The following graphic shows some other examples of workers’ comp fraud:

Nevada Defenses to Workers’ Comp Fraud

Possible strategies to fight Nevada charges of workers’ comp fraud include:

• No intent to defraud
• False accusations
• Police misconduct

Nevada Penalties for Workers’ Comp Fraud

Workers’ comp fraud is usually prosecuted as a category D felony. The punishment carries:

• 1 – 4 years in Nevada State Prison, and
• maybe $5,000 in fines, and
• victim restitution, including possible reimbursement of benefit payments²

“Workers’ comp fraud is committed by either employers, employees, insurance carriers, or related parties such as physicians.” – Nevada criminal defense attorney Michael Becker

Click on a topic below for more information or continue scrolling down.

• 1. Definition of Workers’ Compensation Insurance Fraud
  • 1.1. Applicant fraud
  • 1.2. Employer fraud
  • 1.3. Carrier fraud
  • 1.4. Claims mills
  • 1.5. Provider fraud
  • 1.6. Prosecution of workers’ comp fraud
  • 1.7. Federal workers’ comp fraud laws
• 2. Defenses to Workers’ Compensation Insurance Fraud
• 3. Penalties for Workers’ Compensation Insurance Fraud
  • 3.1. Nevada penalties
  • 3.2. Federal Penalties

Go back to our general Nevada insurance fraud page. 

1. Definition of Workers’ Compensation Insurance Fraud

Workers’ compensation insurance pays employees who are injured on the job for their medical expenses and lost wages. The Nevada crime of “workers’ compensation insurance fraud”…abbreviated “workers’ comp fraud”…occurs when someone deliberately tries to bilk the system to get financial benefits they are not entitled to.

There are several types of workers’ comp fraud in Nevada depending on who committed the alleged fraud.³ Possible perpetrators are the injured employee (the applicant), the employer, the employees’ physicians, or the workers’ compensation insurance carrier:

1.1 Applicant fraud

“Applicant fraud” in Nevada is workers’ comp fraud perpetrated by the alleged injured employee. These cases typically involve employees who do — or attempt to do — any of the following in order to collect workers’ comp insurance:

• Fake an injury or exaggerate the extent of their injury,
• Falsely claim that an injury occurred on the job, or stage a fake accident,
• Fail to disclose a previous injury,
• Deny filing previous workers’ comp insurance claims,
• Collect workers’ comp benefits for the same injury from more than one employer, and/or
• Illegally work while simultaneously receiving workers’ comp benefits.

Note that defendants in applicant fraud cases may face additional charges in Nevada depending on the circumstances of the case. Common related crimes include:

• grand larceny,
• forgery, and/or
• perjury

Nevada is a no-fault workers’ comp state. This means that anyone who is covered by workers’ compensation insurance may collect benefits even if his/her work-related injury was his/her fault.

1.2. Employer fraud

“Employer fraud” in Nevada is perpetrated by employers trying to get out of paying workers’ comp insurance premiums. Employer fraud usually involves situations where an employer does one or more of the following:

• Lies about the number of his/her employees to the workers’ compensation insurance carrier,
• Threatens to terminate or punish an employee who tries to claim workers’ comp benefits,
• Fails to carry workers’ compensation insurance, which most employers are legally obligated to have, or
• Deducts money from a worker’s wages in order to pay for insurance premiums

Another common type of employer fraud is when employers misrepresent their employees’ job duties in an effort to pay less expensive premiums.

Example: Mac owns a warehouse in Henderson. His employee Tom’s job is to carry inventory around the warehouse, which involves climbing tall ladders and lifting heavy items. But Mac reports to his workers’ compensation insurance carrier that Tom has a desk job. Mac lied in order to avoid paying insurance premiums for a high-risk job. Since Mac intentionally lied to the insurance carrier in order to pay a cheaper premium, Mac could be criminally liable for workers’ compensation fraud in Nevada.

1.3. Carrier fraud

Carrier fraud is a fraud perpetrated by the workers’ compensation insurance carrier itself. This fraud occurs when the insurance carrier lies about a worker’s eligibility to collect benefits in order to pay that worker less money.

1.4. Claim mills fraud

Organized workers’ compensation fraud rings are called “claim mills.” Claim mills are typically comprised of doctors, attorneys and their staff (called “runners,” steerers,” or “cappers”). Claim mills recruit people to file fraudulent workers’ compensation claims so the claim mill can share in the benefits.

1.5. Provider fraud

Provider fraud is when medical providers like doctors take advantage of patients legitimately injured on the job by either:

• Providing unnecessary treatment,
• Overbilling services, and/or
• Billing for services that the provider never performed.

Depending on the case, defendants in provider fraud cases may also face charges for health care fraud.

1.6. Prosecution of workers’ comp fraud

Nevada’s workers’ compensation insurance laws are overseen by Nevada’s Department of Business and Industry. Allegations of workers’ comp fraud are prosecuted by the Workers Compensation Unit of the Nevada Attorney General’s Office. Note that the Attorney General prosecutes not only people who allegedly make false insurance claims … but also anyone who aids or conspires with people to make false claims.⁴

1.7. Federal workers’ comp fraud laws

The U.S. government has its own federal workers’ compensation program called the Federal Employees’ Compensation Act (FECA).⁵ Similar to Nevada, it is a federal crime to try wrongfully to obtain FECA benefits by intentionally making false statements or concealing material facts.⁶

Expert legal counsel is essential to fighting a workers’ compensation insurance fraud charge.

2. Defenses to Workers’ Compensation Insurance Fraud in Nevada

Workers’ comp fraud is not a strict liability crime; a person should not be found guilty of it if there is no specific intent to defraud.

There are various ways to fight Nevada charges of workers’ comp insurance fraud. The best strategy depends on the circumstances of the case. The following are the most common defenses:

a) No intent to defraud. A defendant is liable for workers’ comp fraud only if he/she meant to deceive the insurance carrier. Mistakenly overbilling a client or misreporting an employee’s position is not illegal. Even working while receiving workers’ comp benefits is no crime if the person honestly believed he/she was allowed to do both. Lacking fraudulent intent always exempts the defendant from criminal liability for fraud:

Example: Barbara falls from a ladder at her Home Depot job. At the hospital a doctor looking at the wrong X-rays mistakenly informs Barbara that she has a compound fracture and needs to stay off of her leg for four months. Barbara applies for workers’ comp benefits to pay for her four-month leave. The insurance company conducts an internal investigation and finds that in fact Barbara has only a bad sprain that requires far less bed rest. However Barbara should not be convicted of workers’ comp fraud because she honestly and reasonably believed that her injury was more severe than it was. In short, Barbara had no intent to defraud.

b) False accusations. Every workers’ comp claim passes through several parties: the worker, the employer, a physician, the insurance company, and many of their office staff. Therefore it may be difficult for police to determine which person(s) perpetrated the fraud: If one person in an office perpetrated a fraud, the police may presume others in the office are “guilty by association.” And sometimes the defendant may be falsely accused by the person who actually committed the fraud in an effort to save him/herself. As long as the D.A. cannot prove beyond a reasonable doubt that the defendant perpetrated the fraud, the workers’ comp charges should be dropped.
c) Police misconduct. Workers’ comp fraud cases involve extensive police investigations. If the police fail to follow proper search warrant procedures, then the defense attorney can file with the court a motion to suppress evidence. This motion explains to the court why the police search was unlawful, and it asks the court to overlook any incriminating evidence found from the illegal police search. If the court grants the motion to suppress, the D.A. may then be forced to dismiss the charges for lack of evidence.

3. Penalties for Workers’ Compensation Insurance Fraud in Nevada

Workers’ comp fraud carries not only prison and fines, it may cost the defendant his/her professional license and livelihood.

3.1. Nevada penalties

Most Nevada charges for workers’ comp fraud are prosecuted as category D felonies. The punishment includes:

• 1 – 4 years in Nevada State Prison, and
• maybe $5,000 in fines, and
• victim restitution in Nevada, including possible repayment of benefits

In addition, the defendant may have his/her professional licenses suspended and revoked. The defendant may also be ineligible to receive future workers’ comp benefits.⁷

3.2. Federal penalties

The sentence for deliberately trying to defraud FECA is up to 5 years in federal prison and/or up to $10,000 in fines. The defendant will also lose payments for medical expenses, lost wages, and other benefits under FECA.⁸

Accused of “workers’ comp fraud” in Nevada? Call a lawyer…

Call our Las Vegas fraud lawyers for help

If you have been arrested for “workers’ compensation insurance fraud” in Nevada, call our Las Vegas criminal defense lawyers for a meeting to discuss your options. We may be able to keep you out of jail and have your charges dismissed or reduced.

We represent clients throughout Nevada, including Las Vegas, Henderson, Washoe County, Reno, Clark County, Carson City, Laughlin, Mesquite, Bunkerville, Moapa, Elko, Pahrump, Searchlight and Tonopah.

Return to our main page on Nevada fraud crimes.

In California? See our page on California Workers’ Comp Fraud Law.