NC Workers’ Comp Fund Members Reimbursed After Fraud
Posted on Aug 26, 2009
According to the Charlotte Business Journal and Workforce Management, approximately $6.5 million in checks were mailed to former members of the Phoenix Fund, a North Carolina group workers' compensation fund that was self-insured. The checks were mailed after it was revealed that the group was involved in reinsurance fraud.
As reported by the North Carolina Department of Insurance, the money was given to 661 workers that belonged to the workers comp group. In October of 2006, the North Carolina Insurance Department discovered that the Phoenix Fund had become a victim of a $20 million scheme that was run by Thomas G. Reitz, whom Insurance Commissioner Wayne Goodwin described as the purported insurance broker for Phoenix Fund. The program was then put into rehabilitation.
After Reitz pled guilty to money laundering and mail fraud, North Carolina recovered over $19 million from the criminal, who is now serving 70 months in prison for his involvement in the self-insured workers' compensation fund.
The remaining $11.5 million recovered from Reitz will be used to cover the fund's other obligations.
"The Phoenix Fund's member companies have gone through a lot over the last few years, and I'm glad that my department is able to give back money they are entitled to," Goodwin says. "In this economy every dollar counts, for both individuals and companies, and I am committed to making sure that these member companies get back every available penny."