Alleged Leader of Fraud Ring Helped Crack ’86 Case : Workers’ comp: A police affidavit outlines city employee’s role in the earlier inquiry. Report also details other suspects in the current probe.

The woman accused of heading a ring that allegedly defrauded the city’s workers’ compensation system of about $1 million helped expose a similar scheme by another employee eight years ago, according to police reports.

Thelma Bowman, a top workers’ compensation supervisor for the city of Los Angeles, had worked with the Police Department in 1986 to convict a fellow employee of charges similar to the ones she could now face.

Bowman’s alleged conversion from witness for the prosecution to prime suspect is just one of the ironies in the case, a police affidavit shows. The report--filed by police to obtain a warrant to search Bowman’s home and office and eight other locations--provides the first detailed description of those who are suspected of conspiring in the case.

Included in the group are a Carson doctor, who was allegedly a conduit for most of the illicit payments, and a former Los Angeles police officer turned private investigator, who is suspected of billing the city for workers’ compensation investigations that he never performed.

Authorities have not arrested or charged any of the suspects in the case, although Bowman has been placed on paid leave. Bowman has denied that she defrauded the city, and her attorney indicated that the general disarray of the city’s Workers’ Compensation Division may have caused the problems cited by police.

The three private investigators involved in the investigation all denied wrongdoing in interviews Tuesday, saying they have records to prove that they did the work they were paid for. None of the three doctors being investigated could be reached for comment.

According to the police affidavit, Bowman is suspected of working with the doctors and private investigators to submit false claims. The supervisor of the police investigation said officers believe that the doctors and investigators would be paid by the city and then return a share of the proceeds to Bowman for authorizing the illicit payments.

Lt. Ken Welty, who heads the fraud unit of the department’s bunco-forgery division, said suspicions were raised about the doctors and investigators because the city’s files did not include documentation to prove that they had provided the services they were paid for.

Welty said bank records will be searched to complete the more difficult part of the investigation--proving that payments were made back to Bowman. Because such illicit payments would probably be made in cash, they could be hard to track, Welty said.

Investigators suspect that Dr. Eddie Boatwright of Carson was the conduit for most of the payments. During five months last year, the doctor was paid nearly $500,000 by the city for treating 33 injured city employees, according to an April, 1993, internal audit cited by police.

Boatwright had not submitted the required medical reports and had not been properly authorized to treat anyone, according to the audit. Nonetheless, Bowman authorized that the doctor receive payment for all the work.

A few months after the suspicious payments ended, Boatwright allowed his physician’s license to expire, according to the Medical Board of California.

The payments to Boatwright ended last summer after questions were raised by Workers’ Compensation Division employees. A few months later, suspicious payments began to two other doctors, the police affidavit says.

Dr. James Miller of Gardena and Dr. Howard Bass of Carson each submitted bills for 10 cases, totaling more than $150,000. Again, there were no bills or other documentation in city files to show that they had completed the work. When a police investigator went to check the billing addresses for the doctors, they found no offices, just post office boxes, the police document says.

Three private investigators--Harris Eugene Harris, Richard E. Ervin and Theron Wiggins--also were paid a total of more than $150,000, although the city did not have proper documentation to make the payments, according to the audit that precipitated the police investigation.

Usually, investigators are hired to verify that workers are disabled when they say they are. But all three of the investigators were paid for cases in which workers had recovered from their injuries and returned to work--eliminating the need for investigation, according to the audit cited by police.

The audit said Bowman authorized the payments.

One investigator, Ervin, is a former LAPD officer who retired on disability in 1991. Harris owns two private investigation firms, Diaz Investigations and Exact, targeted in the investigation.

Harris said his company completed the work it was ordered to do. He said he feared that if he did not complete the work as assigned by Bowman or others, “they would just simply call someone else.”

“You did what you were instructed to do, no matter how dumb or ridiculous it might appear,” Harris said.

Wiggins and Ervin, in separate interviews, said they have records to show that they did the work the city paid for.

The 1986 case that Bowman assisted in marked the last time that the Workers’ Compensation Division was embroiled in such controversy. She wore a hidden transmitter and engaged a fellow employee suspected of fraud in conversation, the affidavit says.

The employee--workers’ compensation analyst Weldon Corbin--pleaded guilty to an unspecified offense, the affidavit said. He was sentenced to community service, Welty recalled.

However, even then, Bowman was not completely free from suspicion. The affidavit says that in 1986 police investigated a tip that Bowman was improperly taking files home and helping her friends in the Police Department to improperly claim that they were injured on duty.

The allegations could not be confirmed, the report states. Two years later, Bowman became head of the unit that screens most of the city’s workers’ compensation claims.