Ex-City Worker Accused of Massive Fraud

In what authorities called the biggest case of its kind in California, a former Los Angeles city personnel supervisor was accused Thursday of masterminding a $1.1-million embezzlement of workers’ compensation funds to finance her world travels, a new home and other extravagances.

Fourteen people--including claims manager Thelma Bowman, 43, of Los Angeles--were charged with bilking the city in a series of scams involving an elaborate web of phony claims and medical billings from August, 1992, to June, 1994.

“This is the largest prosecution for workers’ comp fraud perpetrated against a public entity [in] the state of California,” said Ed Feldman, head deputy of the workers’ compensation fraud division of the district attorney’s office.

The $1.1 million, although all spent, has been reimbursed by insurance, officials said.

The scheme, uncovered during a routine internal audit of the city’s workers’ compensation system, led investigators on a 13-month probe that included search warrants seeking records from 40 financial institutions.

The multi-agency inquiry culminated in the arrests Wednesday and Thursday of Bowman, a 25-year city employee, and 10 others, according to officials from the district attorney’s office, Los Angeles Police Department, city controller’s office and Department of Personnel.

Bowman, who was fired from her job in June, 1994, after the audit, is scheduled to be arraigned today. Late Thursday, her attorney denied that Bowman embezzled city funds and said she would plead not guilty to the charges.

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“The facts will come out,” said attorney Harold Greenberg, who suggested that Bowman was being made a scapegoat for poor accounting procedures by the city. “I think the city has had a lot of problems in the workers’ comp field. . . . The word is accountability.”

The case, authorities said, underscores the widespread threat of workers’ compensation fraud. “It says that indeed the problem is great on the public side as well as on the private side,” Feldman said.

City officials emphasized that their audit uncovered the alleged fraud and that new procedures--and computer equipment--will make workers’ compensation scams more difficult.

Still, officials acknowledged, the case was disturbing because it involved a well-regarded manager. “This is your worst nightmare as an auditor--that someone at this level would do this,” Deputy City Controller Tim Lynch said.

Bowman, who was paid $52,000 a year as a principal analyst, shared in the proceeds of three separate schemes, said Deputy Dist. Atty. Thomas R. Krag.

First, Krag said, Bowman allegedly authorized payments totaling $496,000 to Dr. Eddie Boatwright, 41, of Carson after providing him with enough information to make up phony billings for medical services to city employees. The checks, Krag said, were sent to Boatwright and cashed by him and Bowman’s brother, Jerome Clifton Gavin, 46, of Los Angeles.

An additional $300,000, authorities said, was authorized by Bowman for fraudulent disability claims through altered computerized personnel records. After allegedly creating phony claim sheets, Bowman sent payments to her nieces, a high school classmate and other acquaintances, including her hairdresser, authorities said.

The money was then split with Bowman’s nieces Trina Irvin, 32, Tracy Irvin, 29, and Teresa Denise Wilson, 31, all of Compton, authorities said. Money also allegedly went to other acquaintances, including Garry Graham, 43, and Dora Lee Hooper, 44, both of Los Angeles; Frank Mack, 51, of Compton; Juanita Morris, 30, of North Hollywood, and Ikey Porter Curry, 46, address unknown.

Finally, authorities charge, Bowman also provided information to several private investigators who created about $200,000 in phony billings. Krag said no work was done by the investigators because no reports were found in their files or the city’s. The investigators include Harris Eugene Harris, 45, of Carson, Richard Ervin, 54, of Los Angeles, and Theron Wiggins, 39, of Inglewood.

“This was a very sophisticated fraud . . . which lasted for awhile,” LAPD Capt. Robert Kimball said.

As of Thursday, authorities had arrested all but Gavin, Wiggins and Curry.

For some time, authorities said, Bowman did little to conceal the windfall from her alleged deceit.

Three years ago, when the alleged fraud began, she traveled to Paris, Switzerland, Jamaica, Cancun and Steamboat Springs, Colo., Krag said. Bowman also bought a $352,000 home in Baldwin Hills, paying cash to remodel her kitchen and buy a new Jacuzzi and a $4,000 Italian marble table, officials said.

Bowman’s attorney said the expenditures prove nothing. “In Southern California, particularly up until the last three or four years, a $350,000 home was nothing . . . and as far as traveling, that’s nothing to speak about,” Greenberg said. “So if that is all they [authorities] have, [the case] won’t survive.”

At the time, some co-workers wondered how Bowman afforded her lifestyle. But she had a ready explanation--she was living the good life courtesy of some income properties she owned.

It was the routine audit that finally brought attention to Bowman, authorities said. During the review, officials first became suspicious about the number of payments to Boatwright.

“That caused us to look further, not only into the payments that had been made to Dr. Boatwright, but all other” disbursements, said Faye Washington, the Personnel Department’s general manager. “Her lifestyle did warrant some speculation,” Washington said. “Yes, she did live an exaggerated lifestyle, but she also alleged to other staffers that she had outside income. So should it have raised eyebrows? Perhaps. Perhaps not,” Washington said.

If convicted of all charges, authorities said, Bowman could serve 13 years in prison, Boatwright could serve 10 years, 8 months, and Gavin could serve 8 years, 8 months. The other defendants each face a maximum term of 5 years, 8 months.