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July 18th, 2008

Former State Employees Arrested For Defrauding Worker's Compensation

Attorney General Andrew M. Cuomo today announced the arrests of two former New York State employees who are charged with fraudulently receiving workers' compensation benefits by lying about their employment status.

According to court papers, Dean Dale, 45 of Attica and Darren Krawczyk, 42 of Varysburg claimed to be injured on the job and then filed for and received workers’ compensation benefits. A subsequent investigation by the Attorney General’s Office uncovered that they actually had jobs with other companies while receiving benefits in violation of state law.

"When people choose to defraud workers’ compensation, it’s New York’s taxpayers that end up footing the bill, and that’s unacceptable" said Attorney General Cuomo. "This should serve as a warning to anyone who thinks they can get away with stealing taxpayer dollars for benefits they aren’t entitled to. My office is committed to investigating and prosecuting those individuals and companies who attempt to cheat the system.”

Dale and Krawczyk were charged with Insurance Fraud in the Third Degree, a class D felony, Fraudulent Practices in violation of the Workers Compensation Law, Offering a False Instrument for Filing in the First Degree, and Falsifying Business Records in the First Degree, (class E felonies). The most serious charge carries a maximum prison sentence of seven years.

Dale was employed by the New York State Office of Children and Family Services as a Division for Youth aide at the Oatka Residential Center in Rush, Monroe County. He claimed he was injured in a work-related incident with a resident in March 2004 which made him eligible for workers compensation benefits from the New York State Insurance Fund.  To continue receiving benefits, Dale submitted documents to the State Insurance Fund on or about September 19, 2007, November 2, 2007 and January 21, 2007, in which he denied engaging in any work activity.  However, investigators observed Dale working at the Batavia Downs Racetrack multiple times in September and October 2007.  Investigators also discovered Dale's name on employee logs at the racetrack on numerous occasions from October to December 2007. The felony complaint alleges that Dale obtained approximately $8,925.66 in benefits that he was not entitled to receive.

Krawczyk was a New York State Department of Corrections ("DOCS") officer at the Attica Correctional Facility. He claimed he was injured in a work-related incident in October 2002.  Krawczyk was also entitled to receive workers’ compensation benefits from the State Insurance Fund.  To continue receiving benefits, Krawczyk attended regularly scheduled medical examinations during which he told his physician that he was not working. His physician then conveyed this information to the State Insurance Fund.  However, investigators observed Krawczyk at the Western New York Equine Clinic in Batavia in October and November 2007.  Investigators later obtained payroll information from the clinic that showed Krawczyk worked there from July to December 2007. The felony complaint alleges that Krawczyk obtained approximately $13,521.77 in benefits that he was not entitled to receive.

Dale and Krawczyk were arraigned on July 15th before Rochester City Court Judge Stephen T. Miller and were released on their own recognizance pending a further court appearance on July 30th.

Chief Executive Officer David P. Wehner of the New York State Insurance Fund (NYSIF) said, "This is an example of the most common type of workers' compensation fraud, claimants allegedly concealing employment and income while collecting benefits. These actions hurt those who have legitimately sustained on-the-job injuries and illness and honest employers who obey the law. We welcome and appreciate the assistance of Attorney General Andrew Cuomo in prosecuting workers' compensation fraud. Inter-agency cooperation and teamwork are making a real difference.”

Chair of the Workers’ Compensation Board Zachary S. Weiss said, “New York has zero tolerance for those who try to abuse the Workers' Compensation system. Removing unlawful cases and exposing dishonest employers strengthens the system and makes it easier for deserving workers to get the medical care and wages they’re due.”

The cases are being prosecuted by Assistant Attorney General Michael McCabe under the supervision of Criminal Prosecutions Bureau Deputy Chief Richard Ernst.  A team of investigators conducted the investigation, including the DOCS Inspector General's Office Workman's Compensation Unit, State Insurance Fund Senior Investigator Robert Davis, New York State Police Senior Investigator James Newell, Investigator Kevin Reiman, and Investigator Sandra J. Migaj of the Attorney General's Investigations Bureau, under the supervision of Deputy Chief Investigator James L. Domres.

The charges are merely accusations and the defendants are presumed innocent until and unless proven guilty.

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