2 Arrested Over Phony Workers’ Comp Evaluations

In one of the first criminal cases brought under state laws to combat workers’ compensation fraud, two men have been charged with running a mill that churned out phony physical rehabilitation evaluations.

Errol Dale Frazier, 51, of Los Angeles and Calvin Eugene Wilkerson, 35, of San Diego are accused of scheming to bilk Wilkerson’s employer, American International Group Inc., one of the nation’s largest insurers. Prosecutors did not cite a dollar amount in the charges.

Among the workers that the pair allegedly evaluated and found to be needing more treatment were several who had returned to work and one who was an inmate in a Colorado prison.

Although all the workers had at one time received treatment for work-related problems, none ever consulted the two men, investigators said. Although other cases have been filed under laws that took effect in 1992, prosecutors said this is the first case of an insurance company employee seeking to exploit the system by sending legitimate claims for phony work.

The evaluations were identical in language, including the same grammatical errors and misspellings, investigators said.

According to the indictment, which charges Frazier with 54 counts and Wilkerson with 14, Frazier ran a bogus workers’ compensation evaluation firm and Wilkerson, who worked for the insurance company as a claims adjuster, was a “capper” paid by Frazier to send cases to his firm.

Frazier and Wilkerson also banked on the insurance company being so busy that the firm would pay the claims without checking, investigators said. In fact, at one point when the insurance company was slow in paying, Frazier filed suit in Los Angeles seeking $20,000 in damages.

Frazier owned Frazier & Associates in Los Angeles, as well as Southern California Industrial Specialists, Work Again, Career Finders and Vocational Opportunities, all of which operated from a mail drop in Culver City, investigators said.

San Diego Deputy Dist. Atty. John Massucco, chief of the insurance fraud division, said the investigation is continuing.

Frazier, portrayed by prosecutors as someone who might flee to Jamaica, is being held in San Diego jail on $1 million bail. Wilkerson’s bail was set at $50,000; he is also charged in an unrelated cocaine case.

“Wilkerson was a comparatively small fish in this operation,” Massucco said. “We’re looking into whether the Frazier companies were being fed claims by other adjusters.”

The case was referred to prosecutors when American International Group’s investigators became suspicious. “The insurance company bore the laboring oar on this investigation, particularly in the early stages,” Massucco said.