Inside California’s Fight Against Workers' Compensation Fraud
Workers' compensation fraud isn’t just unfair—it’s illegal and expensive for everyone. In California, the government has stepped up its fight to stop fraudulent claims and hold people accountable. From Southern California to Fresno County, agencies are cracking down to protect businesses, workers, and the entire insurance system.
If you're a business that hires through staffing agencies, you could be at risk without even knowing it.
What Is Workers’ Comp Fraud?
Workers’ comp fraud happens when someone lies to get compensation benefits they aren’t supposed to. Sometimes it's fraud by employers, like lying about how many workers they have to get lower rates. Other times, it’s fraud by workers, like faking an injury to collect temporary disability benefits. Even fake oral material statements or false material statements on a claim for compensation can land someone in trouble.
California law treats this very seriously. A fraudulent statement related to workers' comp can be a felony subject to jail time, civil penalties, or worse.
Who’s Fighting This Fraud?
There are multiple agencies working together to stop this:
The Department of Insurance runs the Fraud Division, which investigates cases all over the state.
District attorneys in counties like San Diego County, Orange County, Riverside County, and San Bernardino County often file charges against compensation fraud suspects.
Local campaigns—like radio announcements and transit advertisements—help raise awareness with statutory warnings and warnings to employers about the risks of hiring shady staffing agencies.
Plus, organizations like CWCI (California Workers’ Compensation Institute) share research and updates in their CWCI Bulletins, annual reports, and periodic surveys to show trends in indemnity claim frequency and fraud referral rates.
How California Investigates Workers’ Comp Fraud
Curious about how California investigates workers’ comp fraud? Here’s what happens:
Surveys of insurers look for suspicious patterns in compensation claims.
A fraud referral rate is tracked—this shows how often potential fraud is reported by compensation insurers.
Agencies review each material representation or false document to find lies that might cheat the system.
Investigators collect statements, sometimes secretly, and build a case against individuals or companies making false claims.
They look at everything—from entitlement to benefits to annual assessments of how much fraud is costing the state.
Real Trouble in Los Angeles & Beyond
In recent years, Los Angeles compensation fraud cases have led to arrests and major lawsuits. Employers found guilty of lying on COIs or payroll forms face penalties for employers, including huge fines and even jail time. Fake claims by fraudulent workers can also damage an entire company’s reputation—and bring investigations from Christine Baker's former team at the Office Wages and beyond.
Fake Insurance Certificates
Some staffing agencies hand out fraudulent insurance certificates to make it look like they have coverage when they don’t. If your business accepts one of these fake documents, you could be stuck paying for injuries, lawsuits, and penalties—even if you didn’t know the certificate was fake.
That’s why CheckMyCert.org fraudulent insurance certificate verification is a must. The platform offers a free, confidential service that reviews any workers’ comp COI (Certificate of Insurance) you’re given. No sales pitch. No public exposure. Just peace of mind.
What You Can Do Right Now
Always check workers’ comp COIs before hiring a staffing agency.
Report anything suspicious to your local district attorney or the Fraud Division.
Use tools like CheckMyCert.org to avoid legal and financial trouble.
Don’t Take the Fall for Someone Else’s Lie
If your staffing partner commits fraud, the cost of workers may fall on your business. California law clearly states: if they break the rules, you pay the price. That includes criminal provisions, audits, and possible charges.
So, protect your company. Stay informed. And when in doubt, let CheckMyCert.org help you detect and stop fraud before it reaches your doorstep.
