24Oct 2017

Operation Backlash – State Fund Fighting Fraud

A massive and complex fraud involving approximately 51,000 injured workers, crooked attorneys, medical doctors, chiropractors, and marketers has resulted in significant indictments and convictions earlier this year, and is beginning to move into the sentencing phase.

For the past few years the FBI lead an extensive investigation, dubbed “Operation Backlash”, with help from several law enforcement agencies as well as State Fund. The fraud involved illegal kickbacks to recruit and refer injured workers for unnecessary legal and medical services. Most of the fraudulent activities took place in the greater San Diego, Escondido, and Calexico areas. The costs for these ill-gotten services were billed to 35 different insurance companies, including State Fund.

Indictments of 21 individuals (several of whom were chiropractors or medical doctors), and 10 corporations, and convictions of eight individuals and five corporations started in February of this year, and are finally wrapping up.  The sentencing will occur once all the defendants either enter a plea or go to trial.

State Fund Special Investigator Lisa Jones, and Supervising Special Investigator Lane Spencer, were honored with the “Investigation of the Year Award” last year for their role in Operation Backlash by the National Health Care Anti-Fraud Association (NHCAA).  The award stated, “In recognition of outstanding teamwork and dedication to the successful detection, investigation, prosecution, and prevention of health care fraud.”  They were supported by 15 other dedicated State Fund employees who all worked together to help fight this particularly egregious crime.

If you suspect fraud, call our Hotline at (888) 782-8338 / 7:30 AM – 5:30 PM, Monday – Friday.

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