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Criminal Investigations & Employee Classification

NCIC Criminal Investigations & Employee Classification Division

Our Mission

The mission of the Criminal Investigations & Employee Classification Division is to serve the citizens of North Carolina by investigating potential criminal violations of the Workers’ Compensation Act and identifying and investigating businesses that engage in the activities of employee misclassification. The Division ensures compliance with the Workers’ Compensation Act and the Employee Fair Classification Act in a manner that fosters confidence and compliance with the law.

Criminal Investigations

Criminal Investigations operates as a law enforcement agency and is responsible for conducting criminal investigations into cases of suspected workers’ compensation fraud, employee misclassification, and violations related to workers’ compensation claims involving employees, employers, insurers, health care providers, attorneys, and vocational rehabilitation providers. Criminal Investigators investigate all criminal complaints filed with the Industrial Commission regarding failure of employers to maintain workers’ compensation insurance (N.C. Gen. Stat. § 97-94(d)), fraud on the part of employees with regard to the collection or obtaining of workers’ compensation benefits (N.C. Gen. Stat. § 97-88.2), fraud on the part of employers with regard to payment or collection of workers’ compensation premiums from employees’ salaries (N.C. Gen. Stat. § 97-21), medical payment fraud, and any other claims arising out of violations of Chapter 97 by employees or employers. Criminal Investigations works with judicial officials and other law enforcement agencies throughout the state to resolve the above investigations in criminal court.

Criminal Investigations collaborates with the Employee Classification Section to proactively identify and investigate employee misclassification, thus helping ensure compliance with the Employee Fair Classification Act and applicable workers’ compensation statutes.

Employee Classification Section

The Employee Classification Section was established within the Industrial Commission under the Employee Fair Classification Act (Article 83, N.C. Gen. Stat. § 143-785 through 143-791, Session Law 2017-203, s. 1) .

Employee misclassification is defined in N.C. Gen. Stat. § 143-786(5) as avoiding tax liabilities and other obligations imposed by Chapter 95, 96, 97, 105, or 143 of the North Carolina General Statutes by misclassifying an employee as an independent contractor.

The Employee Classification Section receives reports of employee misclassification and is responsible under the Employee Fair Classification Act for investigating these misclassification reports and coordinating with and assisting all relevant state agencies in recovering any back taxes, wages, benefits, penalties, or other monies owed as a result of an employer engaging in employee misclassification.

The Employee Classification Section’s statutory mandate also includes providing all relevant information pertaining to each instance of reported employee misclassification to the North Carolina Department of Labor, the Division of Employment Security within the North Carolina Department of Commerce, and the North Carolina Industrial Commission to facilitate investigation of potential violations of Chapters 95, 96, 97, 105, or 143 of the North Carolina General Statutes.

Public Notice Statement pursuant to G.S. 143-788(a)(5)

Click here for the Public Notice Statement as set forth in G.S. 143-788(a)(5).

Reporting Fraud or Employee Misclassification

If you suspect fraud or employee misclassification that meets one of the above criteria, submit a complaint utilizing one of the following methods:

• E-mail at fraudcomplaints@ic.nc.gov,
• Call 1-888-891-4895 (in North Carolina),
• Fax: 919-508-8300 (Send to ATTENTION CRIMINAL INVESTIGATIONS & EMPLOYEE CLASSIFICATION DIVISON), or
• Mail the information to the Criminal Investigations & Employee Classification Division at:
  1233 Mail Service Center
  Raleigh, NC 27699-1233
• You may report misclassification anonymously by clicking here. This page does not collect any personal or location information -- your submission is completely confidential. The records of the Employee Classification Section are not public records in accordance with N.C. Gen. Stat. § 143-766(a).

Whether you submit the complaint via e-mail, U.S. Mail, or call the fraud hotline, we will ask you to confidentially provide all of the information you have pertaining to the suspected fraud, including the following:

Complaint Checklist

Employee/Claimant Fraud

Please provide as much of the following information as possible in matters that may involve fraud perpetrated by a claimant:

• Name and address of the person you suspect is committing fraud.
• Details about the improper or fraudulent activity you suspect such as: exceeding physical limitations, working while receiving benefits, malingering, reporting false claims, or a staged accident in violation of N.C. Gen. Stat. § 97-88.2.
• Type of injury and date of injury (if known).
• Name of employer at the time the injury was sustained (if known).
• Documentation that supports your complaint such as: videos, photographs, payroll records, additional witnesses, falsified documents, activity level with a vivid description of activity. (Please indicate if you have this documentation.)
• Name of employer or, if self-employed, business location, and contact information.
• Other general information pertaining to the suspected fraudulent activity.
• Your relationship or involvement with the suspected person(s).
• Other agencies this incident has been reported to.

Employer Fraud

If the target is an employer, the complainant should provide as much of the following information as possible:

• Name and address of company or business.
• Relationship to business owner or company if any (employee, former employee, partner, etc.)
• Details about the improper or fraudulent activity you suspect, such as employer fails to secure workers’ compensation insurance in violation of N.C. Gen. Stat. § 97-94, employer deducts workers’ compensation premiums for employees’ wages in violation of N.C. Gen. Stat. § 97-21, employer threatens employee prosecution for purpose of coercing or attempting to coerce the employee into agreeing to compensation or forgo compensation in violation of N.C. Gen. Stat. § 97-88.2.
• Documentation that supports your compliant such as copies of records, additional witnesses, copies of billing statements, copies of payment records.
• Other general information pertaining to the suspected fraudulent activity; and
• Other agencies this incident has been reported to.

Employee Misclassification

Reporting Checklist:

Please provide as much of the following information as possible when reporting potential claims for employee misclassification:

• Name and address of business and/or individual you suspect is committing misclassification;
• Nature of work/activities being performed by worker;
• Relationship of reporting party to the business, if any (employee, former employee, partner, competitor, etc.);
• Details about employer relationship with workers, including but not limited to: employer establishes the activities that constitute the daily work requirements for workers, employer provides direction on how to complete specific working tasks, or employer provides equipment for workers to complete assignments/tasks;
• Documentation that supports the claim for misclassification, including but not limited to: tax documentation, copies of payment records, employment offer letter, or documentation pertaining to agreement for contracted services;
• The number of additional workers performing the same and/or similar duties;
• Additional information pertaining to suspected misclassification activity; and
• Other agencies, if any, to which this information has been reported.

Criminal Investigations & Employee Classification Division Contacts

The Criminal Investigations & Employee Classification Division consists of a Division Chief, five (5) Criminal Investigators, one (1) Investigative Assistant, one (1) Administrative Specialist and a Director of the Employee Classification Section. The telephone numbers and e-mail addresses for the Criminal Investigations & Employee Classification Division: