Investigators: Tacoma couple swindled state out of $223K

TACOMA, Wash. -- A Tacoma couple accused of defrauding the state of nearly a quarter million dollars in workers' comp benefits insists they were too injured to work, but investigators say they have video that proves otherwise.

Washington receives more than 1,500 tips about worker fraud each year, and one tip led investigators to Larry Beroth.

In 2009, Beroth and his wife filed claims saying neither could work after being injured on the job at their Tacoma drywall business. Detectives say he signed her paperwork in the case, and she signed his.

Over the next two years, the couple collected $223,000 in taxpayer benefits. All the while, investigators say they continued to work.

"We had been paying them benefits believing that they were out of work, when in fact they were working the entire time," said Elizabeth Smith, fraud prevention and compliance program manager with Washington Labor and Industries.

After being tipped off about the alleged fraud, investigators secretly videotaped the couple. The footage shows Larry Beroth lifting boxes, pulling supplies and even kneeling to roll up a hose.

The state filed charges against the Beroths earlier this month. In court documents, Larry told investigators "he was guilty and would just like to know how much he owned the department." His wife said "she knew what they did was wrong, but at times felt they had no choice," according to the documents.

Despite those admissions, the couple pleaded not guilty in court. Their attorney had no comment on the story.

"It's a pretty egregious case," Smith said.

It's a case the state says scratches the surface on the larger issue of people defrauding taxpayers and scamming the system. Investigators hope the case, as well as the video, deliver an important message.

"Fraud costs workers and businesses millions of dollars a year every year in Washington state," Smith said.

Both Larry and Jamie Beroth are facing charges of first degree theft.