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North Carolina collection of comp fraud penalties tops $8 million

The North Carolina Industrial Commission’s Compliance and Fraud Investigative Division on Friday said it collected more than $8 million in workers compensation fraud penalties for the 2017-18 fiscal year, a 465% increase over the prior fiscal year, stemming from 696 criminal charges.

Last fiscal year the commission collected $1.7 million in fraud penalties stemming from 405 criminal charges, according to a chart provided in a statement.

The increases are due to a “substantial number of investigations” that commenced and closed, with new reviewing methods that are not being disclosed because of ongoing investigations, according to a commission spokesman.

“With input from my staff, we have improved our internal methods for reviewing cases, which has allowed staff to pursue penalties and criminal charges more efficiently,” he wrote Monday in an email. 

The division works with businesses to ensure adequate workers compensation insurance is maintained and identifies noncompliant businesses using an advanced data-matching application. The proceeds from penalties collected go to the state’s Civil Penalty and Forfeiture Fund to benefit North Carolina’s public schools, according to the statement.

The industrial commission’s workers comp fraud investigative unit, which conducts criminal investigations, also reported increased results for this fiscal year, with investigators closing 5,314 cases and issuing 688 criminal charges. That unit closed 3,146 cases last fiscal year and issued 405 criminal charges.