Case File
When a carrier accused a bricklayer of concealing prior injuries, the Workers’ Compensation Board found the evidence failed to establish that the prior insurance claims actually involved the claimant.
Case
Matter of Loja-Saula v. Cosan Construction, No. CV-25-0822 (N.Y. App. Div. 09/03/26)
What Happened?
A New York bricklayer filed a claim for workers’ compensation benefits for work-related injuries after a piece of a concrete cinderblock fell on him. Following a hearing, a Workers’ Compensation Law Judge established the claim for injuries to the bricklayer’s head, left shoulder, and back, but disallowed the claim for injuries to his neck, left wrist, and left knee.
On review, the Workers’ Compensation Board modified the WCLJ’s decision by amending the claim to include injuries to the neck, left wrist, and left knee. At a subsequent hearing, the employer’s carrier alleged that the bricklayer failed to disclose prior injuries to the sites listed in his C-3 claim form, which would violate Workers’ Compensation Law Sec. 114-a. The WCLJ found that the bricklayer had violated Workers’ Compensation Law § 114-a
On administrative review, the Board found insufficient proof that the bricklayer violated Workers’ Compensation Law § 114-a and rescinded the WCLJ’s decision. The carrier appealed.
Rule of Law
In New York, a claimant who, for the purpose of obtaining workers’ compensation benefits, 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. An omission of material information may constitute a knowing false statement or misrepresentation.
What Appellate Division Said
The court affirmed the Board’s decision. The court agreed that the carrier failed to present sufficiently reliable proof tying the bricklayer to the alleged prior claims. The Board found significant inconsistencies in the carrier’s ISO reports, including differing names, birth years, and addresses. Although some records matched the bricklayer’s identifying information, the Board concluded they could have referred to the April 2022 work injury rather than undisclosed prior injuries.
According to the court, there were challenges with two Insurance Services Office reports that listed insurance claims the carrier alleged the bricklayer had filed pertaining to prior accidents that he purportedly failed to disclose in his C-3 form.
In particular, the court pointed out:
(1) The first ISO report was based upon a search for claims brought under the bricklayer’s name and found three matches, but two of the matches had slightly different names than the bricklayer and listed different home addresses than the address the bricklayer testified to as the only one he has had in this country. The third match contained bricklayer’s name and his address and indicated that he was involved in a motor vehicle accident in 2017 with an unspecified injury.
(2) The second ISO report was based upon a search of claims brought under the bricklayer’s purported Social Security number. and it found 13 matches. Two such matches referenced the bricklayer’s correct name and address and indicated that he filed claims based upon an April 15, 2022, injury date, which is the date that the bricklayer was injured by the cinderblock. Both matches referenced injuries to bricklayer’s head, teeth, left shoulder and left side of neck, and one of the matches indicated that the claim was covered by a commercial liability policy, while the other match indicated that the claim was covered by a workers’ compensation policy and referenced the employer as the insured. The remaining 11 matches involved personal automobile insurance claims spanning from 1999 to 2014, which were made by individuals with different dates of birth and addresses than the bricklayer, as well as slightly different names.
(3) The carrier also submitted a January 2024 arbitration award report that detailed a lawsuit brought by a pharmacy against an insurance carrier seeking payment for prescriptions provided to an individual with the bricklayer’s name who, according to the report, was involved in a motor vehicle accident on April 15, 2022, the same date as claimant’s work injury. The court pointed out that the bricklayer did not have a Social Security Number and never provided a number to anyone and that he did not get prescription medicine at the pharmacy involved in the arbitration.
Based on these points, the court disagreed with the carrier’s contention that the Board erred in finding insufficient proof of a Workers’ Compensation Law § 114-a violation.
Ask AI: We wanted to know what the basics of a Workers’ Compensation Law § 114-a investigation looked like, so we turned to artificial intelligence. Here’s what it told us —
A New York Workers’ Compensation Law § 114-a investigation is essentially a fraud investigation. The carrier is trying to determine whether a claimant knowingly made a false statement or omitted material information in order to obtain benefits.
The Elements of a § 114-a Case
To establish a violation, a carrier generally must prove:
- The claimant made a statement or representation (including by omission).
- The statement concerned a material fact.
- The statement was false.
- The claimant knew it was false.
- The statement was made for the purpose of obtaining workers’ compensation benefits.
The biggest stumbling blocks are usually materiality and proof that the claimant knowingly made the misrepresentation.
Common Investigation Areas
Prior Injuries and Claims
Investigators look for:
- Prior workers’ compensation claims
- Prior motor vehicle accidents
- Personal injury lawsuits
- Disability claims
- Prior treatment to the same body parts
Typical records include:
- ISO ClaimSearch reports
- Prior compensation files
- Medical records
- No-fault files
- Social Security records (when authorized)
The Loja-Saula case is a good example of the danger of relying too heavily on ISO reports without sufficient corroboration.
Employment and Earnings
One of the most common § 114-a investigations involves undisclosed work activity.
Examples:
- Claimant reports being unable to work but is employed elsewhere.
- Claimant operates a business.
- Claimant performs cash jobs.
- Claimant underreports earnings.
Evidence may include:
- Payroll records
- Tax returns
- Business filings
- Bank records
- Employment applications
Physical Activity
Carriers frequently investigate whether physical activities are inconsistent with reported disability.
Examples:
- Heavy lifting
- Construction work
- Sports participation
- Home improvement projects
Evidence may include:
- Surveillance video
- Social media posts
- Witness testimony
Importantly, activity alone is not fraud. The activity has to contradict a material representation made by the claimant.
Typical Investigation Process
1. File Review
The carrier compares:
- C-3 claim form
- Medical reports
- Deposition testimony
- Hearing testimony
- Prior claim history
The investigator is looking for inconsistencies.
2. Records Search
Common searches include:
- ISO ClaimSearch
- DMV records
- Court records
- Property records
- Business records
- Social media
3. Surveillance
If questions remain, surveillance may be conducted.
The goal is usually to determine whether observed activities conflict with the claimant’s reported restrictions.
4. Witness Development
The carrier may obtain testimony from:
- Employers
- Co-workers
- Neighbors
- Treating physicians
- Independent medical examiners
5. Board Hearing
Ultimately, § 114-a cases are won or lost before a Workers’ Compensation Law Judge and the Board.
The Board decides:
- Whether the statement was false.
- Whether it was material.
- Whether it was knowingly made.
- Whether penalties are appropriate.
Common Carrier Mistakes
The Loja-Saula decision highlights one of the biggest mistakes:
Mistaken Identity
The carrier may find records suggesting prior injuries, but cannot adequately prove they belong to the claimant.
Red flags include:
- Different addresses
- Different birth dates
- Different Social Security numbers
- Slightly different names
A good investigation should corroborate identity through multiple sources.
Assuming a Medical Condition Equals Fraud
A claimant may forget treatment from years ago.
A forgotten or misunderstood medical history is not automatically a knowing misrepresentation.
Overreliance on Surveillance
A video showing someone carrying groceries for five minutes does not necessarily disprove disability.
The carrier must connect the observed activity to a specific false statement.
Potential Penalties
If a § 114-a violation is established, penalties can include:
- Forfeiture of benefits directly attributable to the false statement.
- Mandatory disqualification from those benefits.
- Potential discretionary forfeiture of additional wage replacement benefits.
- Credibility damage that affects the remainder of the claim.
Practical Lesson for Adjusters
The strongest § 114-a cases usually involve three things:
- A clearly identifiable statement by the claimant.
- Objective documentary evidence showing the statement is false.
- Independent proof establishing the claimant knew the statement was false.
When any of those pieces are missing, especially identity proof, the Board may conclude that fraud has not been established, which appears to be the central lesson from Matter of Loja-Saula v. Cosan Construction.
“The Board noted the inconsistencies in the ISO reports regarding whether the individuals listed therein were claimant, including the 11 matches in the second report pertaining to individuals with different birth years and addresses than claimant,” the court wrote. “The Board also noted that the two matches that identified claimant by name, address and birthdate on that report could be referring to claimant’s April 15, 2022, work-related injuries, rather than injuries from a motor vehicle accident.”
The court also emphasized that the Board found nothing to verify that the person identified in the arbitration award by name only as the injured party was the bricklayer.
Verdict: Appellate Division affirmed the Board’s ruling.
Takeaway
In New York, allegations of claimant fraud cannot rest on claim-history reports alone when identifying information is inconsistent or ambiguous. If the Board concludes that the evidence does not reliably establish that prior claims belonged to the claimant, Appellate Division is unlikely to disturb that determination.
A carrier alleging a Workers’ Compensation Law § 114-a violation must present reliable evidence linking the claimant to the allegedly undisclosed prior claims or injuries. Where the record contains conflicting identifying information and the Board concludes the carrier failed to establish that connection, the Appellate Division will generally defer to the Board’s factual determinations.
