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Division of Workers’ Compensation Fraud Unit

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Workers’ compensation fraud increases system costs, which results in higher insurance premiums for Texas employers and drains resources from the system that could be allocated to providing benefits for injured employees. DWC is charged with administering and regulating the workers’ compensation system to ensure that employees receive the benefits they deserve at a reasonable cost for Texas employers.

What is workers’ compensation fraud?

Workers’ compensation fraud occurs when someone willfully makes a false statement or conceals information in order to receive workers’ compensation benefits or prevents someone from receiving benefits to which they might be entitled. Workers’ compensation fraud is usually motivated by greed.

Why do people commit workers’ compensation fraud?

People who normally would not engage in criminal behavior commit workers’ compensation fraud because they:

  • Perceive it as a victimless crime perpetrated against a faceless insurance company.
  • Hope to make up for premiums they have paid in the past.
  • Think many people inflate or falsify insurance claims.
  • Believe they will not get caught.
  • See it as a quick and easy way to make money.

Who pays for workers’ compensation fraud?

Workers’ compensation fraud is not a victimless crime. The Coalition Against Insurance Fraud estimates that more than $80 billion in fraudulent insurance claims are made annually (this includes all insurance lines including workers’ compensation fraud). All Texans pay for workers’ compensation fraud through higher costs of good and higher premiums.

Help us find and stop criminals who try to take advantage of the system.

Click on the following links for details on how to help find and stop workers’ compensation fraud:

What We Investigate
Workers' Comp Fraud Indicators
Reporting Workers’ Compensation Fraud
Workers’ Compensation Fraud Stats
Contact Us

What we investigate

Employee Fraud

  • An employee who is drawing benefits because he/she is supposed to be unable to work and is working full time at an unreported job
  • An employee fakes an injury in order to collect benefits

Health Care Fraud

  • A health care provider assists the employee in a fraudulent scheme
  • A health care provider bills for services not provided

Premium Fraud

  • An employer misrepresents the amount of payroll or classification of employees in order to obtain a lower premium
  • An employer avoids a higher insurance risk modifier by transferring employees to a new business entity rated as a lower risk category

Insurance Carrier Fraud

  • An adjuster creates bogus claims and pays herself through those claims

Attorney Fraud

  • An attorney inflates billing records to increase billable hours
  • An attorney bills for services not rendered

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Workers' Comp Fraud Indicators

Fraud by Employees

  • Injury that has no witness other than the employee
  • Injury occurring late Friday or early Monday
  • Injury not reported until a week or more after it supposedly occurred
  • Injury occurring before a strike or holiday, or in anticipation of termination
  • Injury occurring in a location where the employee would not normally work
  • Injury that is inconsistent with normal job duties
  • Employee observed in activities inconsistent with the reported injury
  • Employee history of workers' comp claims
  • Conflicting diagnoses from subsequent treating providers
  • Evidence of employee working elsewhere while drawing benefits

Fraud by Employers

  • Classification codes inconsistent with duties normally associated with the employer's type of business (e.g. a construction company reporting mainly clerical classifications)
  • Payroll information on the insurance application inconsistent with payroll reported to the Texas Workforce Commission
  • Much larger premium paid for the previous year's policy
  • Unusually small payroll reported by a large employer or employee leasing company
  • Frequent additions and cancellations of coverage, especially if several business entities appear to be owned or controlled by the same person or group

Fraud by Health Care Providers

  • Bills or explanation of benefits for services from health care providers that seem unnecessary or fictitious
  • "Boilerplate" medical reports, or reports that are merely copies of previously submitted reports
  • Treatment dates on holidays for non-emergency situations
  • Bills that represent an unreasonable amount of billable hours per day

Fraud by Insurance Carriers

  • "Boilerplate" forms and documents in file
  • Limited documents in a claim file
  • No supervision oversight needed or requested on a claim

Fraud by Attorneys

  • Attorney Fee bills seem unnecessary or fictitious
  • "Boilerplate" fees
  • Billable hours on holidays for non-emergency situations
  • Attorney Fee bills that represent an unreasonable amount of billable hours per day
  • Complaints from the employee that the attorney is rarely available although the attorney files fee affidavits for services
  • Attorney relationship with a health care provider that appears to be a partnership in handling workers' compensation claims

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Fraud Statistics

WC Fraud Cases Archive by Fiscal Year
WC Fraud Cases Current Fiscal Year
News Releases

Workers’ Compensation Fraud Cases Archive by Fiscal Year

Activity FY2014 FY2015 FY2016 FY2017
Reports Received 1,853 2,186 1,624 1,600
Cases Opened for Investigation 81 43 29 159
Cases Referred for Prosecution 11 6 11 12
Convictions 4 9 1 1


Workers’ Compensation Case Fraud Cases Current Fiscal Year per month

FY2018 Sep ’17 Oct '17 Nov '17 Dec '17 Jan '18 Feb '18 Mar '18 Apr '18 May '18 Jun '18 Jul '18
# Fraud Reports Received 120 119 125 108 113 155 118 138 136 158 109
# of Fraud Investigations Resolved 19 25 11 15 10 9 8 18 11 23 19
# of Successful Prosecutions 1 0 0 1 1 2 2 0 4 0 1


News Releases

Pflugerville landscape company convicted of workers’ comp fraud

New DWC prosecution unit gets indictments for health care fraud

Houston clinic owner pleads guilty to insurance fraud

Division of Workers’ Compensation Centralizes Fraud Efforts


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For more information, contact:

Last updated: 8/7/2018