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Wednesday, February 5, 2014

Mining firm sentenced in workers' comp scheme

Today's post is shared from wvgazette.com
Leads continue to develop out of an investigation into a multimillion-dollar scheme aimed at lowering workers' compensation premiums for contract firms that provided workers to some of the state's largest coal producers, an assistant U.S. Attorney said Tuesday.
U.S. District Court Judge John Copenhaver said the "scam here has been extraordinary" before sentencing Aracoma Contracting LLC to three years probation and ordering restitution be paid.
The scheme involved former BrickStreet Mutual Insurance Co. auditor, Arville Sargent, who took bribes to help contract companies save millions in workers' compensation premiums by paying workers in cash and falsifying payroll records.
It involved four mining contract firms  -- Aracoma Contracting LLC, Christian Contracting, T&W Services LLC, and Newhall Contracting. The companies were controlled by Jerome Eddie Russell, Frelin Workman and his son, Randy Workman.
The four companies were "employee leasing" services that supplied miners for coal companies, including Alpha Natural Resources and Patriot Coal, under arrangements common in the state's mining industry.
Acting on behalf of Aracoma, its principals Russell, 50, of Williamson and Frelin R. Workman, 58, of Belfrey, Ky., formed a relationship with the Bank of Mingo, and one of its employees at the bank's Williamson branch.
Aracoma, Sargent and Workman must jointly pay back about $4.7 million in restitution. Aracoma must also...
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