The South Carolina Workers Comp Consultant
Bob Kohn was a member of the state House of Representatives from North Charleston in 1990 when he became a target in the FBI’s corruption sting of the Legislature. Once confronted, he agreed to cooperate with federal agents in bringing down other lawmakers and was later sentenced to 15 months behind bars.
Prosecutors alleged that starting around 2002, Kohn took part in reporting a company payroll and staff size that was much smaller than it was in reality. By doing so, it would have lowered the company’s insurance premiums by many thousands of dollars. Kohn actually stood over the shoulder of a company secretary and telling her which employees to “peel-off” in an attempt to report the smaller payroll.
In one year, Knight’s payroll size fell from $600,000 to $60,000, Holliday said. For the 2004 year, the company had a payroll of more than $1 million but only reported about $173,000. The overall effect saved Knight’s about $370,000 in premiums over three years.
The fraud allegation came to light after an 18-year-old employee of Knight’s was killed in December 2005 during a below-decks sewer tank accident while he was working on a ship-refit inside Detyens Shipyard. Four others were hospitalized. An insurance company was one of the first to detect an inconsistency in the company’s reporting after Knight’s insurance numbers did not add up.
The conviction means Kohn likely will return to prison, possibly facing as many as three years. The jury at the federal courthouse in Charleston deliberated for about an hour. The sentencing will come at a later date.
What can be learned from this? Check out my next post.