Hotel Worker Sentenced To Eight Months In Jail For WC Fraud

Augusta, ME (CompNewsNetwork) - Attorney General Janet Mills announced today that the Superior Court sentenced Kenneth Villella, age 49, of Biddeford, to eight months in jail for Theft by Deception (Class C) in connection with his theft of workers' compensation benefits from December, 2005 through March, 2006. This is the second case involving worker's compensation fraud to result in jail time in as many weeks. Last week, Landon Logsdon, age 37, was sentenced to six months in jail for theft of workers' compensation benefits. The cases are part of an effort by the Attorney General's Office, working with the Workers' Compensation Board's Fraud and Abuse Unit, to combat fraud in the workers' compensation system and ensure that funds are available to compensate employees who are truly injured and eligible for payment.

The State alleged that Villella worked under the table for a number of Saco-area hotels while collecting workers' compensation benefits for total incapacity following an injury at his employer, Smith and Sons Excavating. When the workers' compensation insurer, Maine Employers' Mutual Insurance Company, requested him to verify his employment status in writing, he falsely reported that he had not been employed or earning wages during the period he had been working for the hotels and collecting benefits. He received over $11,000 in lost wage benefits, including nearly $5,000 after he misrepresented his ability to work.

Villella has not responded to the Workers' Compensation Board's order for him to pay back the benefits as a result of the fraud. On June 30, 2008, the Board found that Villella had in fact engaged in fraud, and ordered him to repay the benefits, along with a civil penalty of $1,000. The hearing officer (Stovall, H.O.) ruled that Villella had "intentionally misrepresented the facts of his employment status and committed fraud in order to obtain lost wage benefits, to which he was not entitled. Mr. Villella's behavior is inexcusable. It hurts legitimately injured workers by creating an environment of suspicion, and financially harms both Employers and Insurers." Villella has failed to make any of the payments ordered by the Board.

"Fraudulent claims harm hard working Maine people by weakening the worker's compensation system. The Office of the Attorney General will bring criminal prosecutions against employees and employers who intentionally violate the Workers' Compensation Act," said Mills. "We will continue to seek jail time for those who submit fraudulent claims to the Workers' Compensation Board."

Attorney General Mills would like to thank Assistant Attorney General Leanne Robbin for her excellent work on this case.

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