With workers' compensation insurance costs increasing exponentially, many companies are cracking down on the possibility of fraudulent claims. Although it is very difficult to get accurate information about the prevalence of fraud in the industry, experts believe that billions of dollars are lost every year to claims that are exaggerated, fictional, or otherwise falsified. State legislatures have also attempted to curtail the growing problem by instituting harsh penalties and other disincentives designed to reduce the number of fraudulent claims that are submitted. In most states, workman's comp fraud is now classified as a felony, and many jurisdictions have instituted mandatory imprisonment as part of the sentence for those convicted of the crime. Because fraud in the workers' compensation system hurts employers and employees alike, it is important to notify the proper authorities if you have evidence or even just a suspicion that fraud is being committed. If you have concerns, talk to your employer or contact a representative of your state's workers' compensation board.