5 Charged in Alleged $100 Million Workers’ Comp Scam

5 men indicted in nationwide workers’ comp scam
Five people, including a man from Tempe, have been indicted in an alleged $100 million workers’ compensation fraud scam that officials say left hundreds of workers across the country without urgent medical care and death benefits, Florida and federal officials said.

According to the indictment, the five men and others conspired between 2001 and 2004 to defraud companies into paying workers’ compensation premiums for fraudulent, illegal and sham workers’ compensation coverage. The fake insurance left thousands of employees without workers’ compensation insurance coverage.

“We found one victim homeless, living in her car, because of mounting medical bills and five families left with no death benefits after fatal accidents,” said Florida Chief Financial Officer Alex Sink.

The indictments named Jerry M. Brewer, 56, of Capistrano Beach, Calif., currently residing in England; Donald Touchet, 53, of El Cajon, Calif; Richard E. Standridge, 58, of Tempe, Ariz.; Robert J. Jennings, 59, of Danville, Ill. and Joshua Poole, 33, of Atlanta.

Brewer is believed to be the ring leader and is charged in each of the 25 counts of the indictment, said Acting U.S. Attorney Jim Klindt. If convicted, Brewer faces up to 275 years in prison and a fine of $8.9 million.

Touchet has been named in 22 counts and faces up to 215 years in prison and a fine of $7.9 million.

Standridge has been charged in 11 counts and faces up to 100 years in prison and a fine of $1.25 million. Jennings has been named in 15 counts and faces up to 165 years in prison and a fine of $2.2 million. Poole has eight counts and faces up to 100 years in prison and a fine of $2.5 million, if convicted.

All the men, except Brewer, were arrested last Thursday. They are scheduled to appear in federal court in Jacksonville on May 4. It was not immediately known if the men had lawyers.

Klindt said they hope to arrest Brewer and bring him back to the U.S.

The government is seeking more than $100 million in forfeiture as proceeds of the scheme. Klindt said among the items the government is seizing are luxury cars and a Picasso painting.

The investigation began in 2002 after the Florida Division of Workers’ Compensation issued a stop work order for failure to secure workers’ compensation against now defunct Jacksonville-based MiraLink Group Inc., an employee leasing company with 20,000 workers.

The owner of operator of MiraLink, Thomas King, is facing up to 20 years in prison and $5.8 million in restitution at his sentencing on May 6. King was found guilty of 23 federal counts of wire fraud last September.

Michael Lee McCafferty, the former chief executive office of TTC Illinois, was sentenced last Wednesday to 33 months in prison and was ordered to pay $7 million in restitution for his part in the scheme. Before it filed for bankruptcy in 2001, TTC was one of the nation’s largest leasing companies with headquarters in Kankakee, Ill, and branches in Tampa and Boca Raton.

“Floridians suffered greatly and did not receive needed medical care and workers’ compensation benefits because these individuals were interested in only enriching themselves,” Sink said.