Insurer Auditor, Others Sentenced for Workers’ Comp Fraud

A former workers’ compensation auditor in West Virginia has been sentenced to six years in federal prison for taking bribes in exchange for allowing coal company contractors to underreport their payroll.

Prosecutors said former BrickStreet Mutual Insurance Co. auditor Arville Sargent of Chapmanville allowed Aracoma Contracting LLC and three other companies to underreport their payroll in exchange for cash and other items.

U.S. Attorney Booth Goodwin has said the fraud cheated BrickStreet out of millions of dollars in insurance premiums it was owed.

The 52-year-old Chapmanville resident was charged with mail fraud and tax evasion in February and pleaded guilty in March.

Besides Sargent, Aracoma Contracting officials were also sentenced in the multimillion-dollar scheme.

Jerome Edward Russell of Williamson, West Va., Frelin R. Workman of Belfry, Ky. and his son, Randy Workman, each pleaded guilty to tax evasion and aiding in the scheme. U.S. District Judge John Copenhaver sentenced both Russell and Frelin Workman to 30 months in prison. Randy Workman received a 15-month sentence. Russell and Frelin Workman are principals in Aracoma Contracting LLC.