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Father, Son Charged with Workers’ Compensation Fraud

6/30/2005

CONTACT:  Nina Banister
(850) 413-2842
 
 JACKSONVILLE—A father and his son are facing workers' compensation fraud charges for allegedly not having the required workers' compensation coverage for employees, resulting in more than $1 million in evaded premiums.  The arrests on Wednesday were the result of an investigation by the Department of Financial Services (DFS), Bureau of Workers' Compensation Fraud.
 
John J. Reaves, Jr., 63, allegedly knew that his son, Shawn, 32, operator of O'Hara supplies, did not have workers' compensation coverage for his employees, who provided labor for two companies owned by the elder Reaves, Southeast Enterprise Group and JR Deck Systems.  FCCI insured SE Enterprise Group and JR Deck Systems Inc., but incurred losses attributable to employees of O'Hara Supplies.  
 
"Evading premiums puts employees at risk of not having the coverage they would need if they are injured on the job and shifts the cost burden to honest employers," said Florida's Chief Financial Officer Tom Gallagher, who oversees DFS. "A healthy workers' compensation system is crucial to Florida's economy, and we will continue to aggressively investigate instances of fraud and abuse."
 
If convicted they each could face up to 30 years in prison. The case will be tried in Duval County by the Statewide Prosecutor's Office in the Fourth Judicial Circuit of Florida.
 
FCCI learned about O'Hara Supplies through audits and forwarded the information to DFS, alleging that Reaves' company owes them $1,000,036 for premiums that have not been paid.
 
The Department of Financial Services, Division of Insurance Fraud, investigates various forms of fraud in insurance, including health, life, auto, property and workers' compensation insurance.  Anyone with information about this case or another possible fraud scheme should call the Department's Fraud Hotline at 1-800-378-0445.  A reward of up to $25,000 may be offered for information leading to a conviction.

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As a statewide elected officer of the Florida Cabinet, Chief Financial Officer Tom Gallagher oversees the Department of Financial Services, a multi-division state agency responsible for management of state funds and unclaimed property, assisting consumers who request information and help related to financial services, and investigating financial fraud. Gallagher also serves as the State Fire Marshal.