Premium Fraud / Signal 05

Cash / off-book labor

Workforce and payment patterns may raise questions about whether all employees and wages are reflected in reported payroll.

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Questions to Answer

Define the representation before choosing the investigation.

Who performed the work and how were they paid?

Are workers employees, legitimate independent contractors, temporary labor, or another arrangement?

Which records can independently establish hours, wages, supervision, and workforce size?

Evidence to Develop

Build the factual chain from independent sources.

Workforce evidence

Rosters, schedules, timekeeping, project logs, supervision and employee interviews.

Payment evidence

Payroll records, checks, lawful financial records, wage receipts, 1099/W-2 information as appropriate.

Contractor analysis

Contracts, invoices, certificates, licenses, independence/control facts, and applicable legal classification standards.

Operational corroboration

Job sites, vehicles, equipment, uniforms, project activity and customer/vendor records.

Next Step

Document what the evidence says - and what it does not.

Record the fact, source, date, relevance, and unresolved questions separately. Where the issue involves classification rules, rating, law, policy interpretation, or criminal referral standards, involve the appropriate specialists rather than asking the investigation to make the legal conclusion.

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