Five Black Car drivers have been charged with fraud by New York State’s Workers’ Compensation Board and experts say that number could increase dramatically in the coming months. In each of the cases, the drivers are said to have violated Workers Compensation Law Section 114-A, which penalizes people who misrepresent their employment status and seek Workers’ Compensation payments they are not entitled to receive.

Section 114-a says that a claimant “who knowingly makes a false statement or representation as to a material fact… shall be disqualified from receiving any compensation directly attributable to such false statement or representation. Additionally, as determined by the board, the claimant shall be subject to a disqualification or an additional penalty up to the foregoing amount directly attributable to the false statement or representation.”

Those who break this law face two distinct penalties: A mandatory penalty that forces them to return the monies they improperly received – PLUS, a discretionary penalty, “which may serve to preclude future awards of benefits, up to and including permanent disqualification, based upon the severity of the situation.”

The law also provides for possible criminal penalties, in certain circumstances.

The New York Black Car Fund, which provides workers’ compensation to tens of thousands of the industry’s For-Hire Vehicle (FHV) drivers – as well as a long list of additional benefits – is assisting the state’s Workers’ Compensation Board, which is aggressively pursuing the cases.

In the cases currently being pursued, the “discretionary penalties” have been steep. One claimant was disqualified from receiving additional benefits until 2024, another claimant was disqualified from receiving additional benefits on his entire claim, a third one was disqualified from receiving further indemnity payments for 10 years, and a fourth was disqualified from receiving ALL future Workers’ Compensation benefits.

Among the most “egregious,” cases, a claimant received an overpayment in excess of $40,000. Another claimant completed 550 trips for a car service over three months and lied about renewing his hack license, while collecting Workers Compensation benefits (this is the claimant who was disqualified from all future benefits).

“Whenever money is involved, the sad truth is that there will be cases of fraud,” explained Ira Goldstein, Executive Director of The Black Car Fund. “What makes Workers’ Compensation fraud particularly selfish and serious is that this money is meant for drivers who truly need it. When you steal money from the Workers’ Compensation fund, you are stealing from your fellow drivers. The process of bringing fraud cases to the Workers Compensation board may be ugly, but it’s not nearly as ugly as theft, and we have an obligation to recover this money for the benefit of all those playing by the rules.”

“The Black Car Fund works hard every day to make sure that our Covered Drivers get what they’re entitled to,” added Berj Haroutunian, Executive Chairman of The Black Car Fund. “By the same token, we will make equally certain that drivers who are NOT entitled to these benefits, do not receive them. Fraud is really a shame and I want to make it clear to everyone that the penalties you will face are severe. No amount of fraudulently obtained money is worth a lifetime ban on future benefits or worse, criminal penalties.”

“What makes matters worse in these fraud cases is that we are a not-for-profit organization, fully funded by a passenger surcharge,” noted Eric Hornick, Chief Claims Officer & Actuary. “When you steal from us, not only are you stealing from your fellow drivers, you are also stealing public money. If we prove fraud, you can lose eligibility for future indemnity benefits, be forced to re-pay benefits fraudulently received, and face both criminal charges and TLC discipline.  We are developing many other fraud cases and if you’re defrauding The Fund, chances are you will get caught. If you have committed fraud, please come forward before we file a case with the Workers’ Compensation Board. The outcome will not be as severe for you.”

“The Workers’ Compensation Board takes fraud cases very seriously,” concludes Mr. Goldstein. “While we are moving forward with civil remedies, everyone should understand that these cases are also subject to criminal charges beyond the Board, depending on the circumstances. This is also an ongoing process, as we consistently identify cases and review claims to make determinations concerning benefit eligibility and the possibility of fraud. We have an obligation to recover money that was taken by fraudulent means for the benefit of all the honest drivers who need it; whether by liens against future earnings, or other property such as bank accounts and homes. Our eyes are open and these five cases are just the beginning, with many more in the pipeline.”

Source: The New York Black Car Fund

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