April 11, 2025 | SIBTF.org — SIBTF fraud case leads to physician’s guilty plea. On April 11, 2025, California physician Kevin Tien Do admitted to conspiring to defraud the Subsequent Injuries Benefits Trust Fund (SIBTF) out of more than $3 million. Although previously suspended in 2018 for another fraud conviction, Do continued to prepare medical reports for Liberty Medical Group. These reports were fraudulently submitted to the SIBTF under other doctors’ names, resulting in millions in improper payouts.
The SIBTF fraud scheme not only involved falsifying medical evaluations but also included elaborate measures to conceal the true source of the reports. By submitting documents under other physicians’ names, Do and his collaborators exploited weaknesses in the verification process, allowing the fraudulent claims to be approved and paid out. This case highlights the potential vulnerabilities in the system and underscores the importance of rigorous oversight, auditing, and compliance measures to prevent future instances of SIBTF fraud.
The Fraud Scheme Uncovered
Do worked for Liberty Medical Group after his 2018 suspension, continuing to draft SIBTF-related medical reports. Liberty Medical Group then submitted these reports to the California SIBTF, listing other doctors’ names to conceal Do’s involvement. Do admitted the fraudulent claims were paid by the SIBTF, with Liberty receiving more than $3 million. The scheme also involved significant tax fraud, with Do failing to report a portion of the income received.
This SIBTF fraud scheme demonstrates how coordinated efforts between unlicensed or suspended individuals and organizations can exploit systemic gaps in claims verification. By misrepresenting both the authorship and legitimacy of medical reports, the perpetrators were able to divert millions in funds intended for legitimately injured workers. The case also illustrates the broader risks to the integrity of the workers’ compensation system, highlighting the need for enhanced oversight, stricter reporting requirements, and cross-agency collaboration to detect and prevent similar fraudulent activities.
Co-Conspirator: An Orange County Judge
The scheme’s co-conspirator was revealed to be Israel Claustro, an attorney who later became an Orange County Superior Court judge. Claustro served as the actual owner of Liberty Medical Group, despite not being a licensed medical professional. Do and Claustro worked together to conceal the fraudulent activities and misappropriate SIBTF funds. The investigation has raised questions about the integrity of both the medical and judicial professions. Physician Admits
Next Steps in the Investigation
Do’s guilty plea sets the stage for his sentencing, with a potential maximum sentence of 20 years in federal prison. The FBI, IRS Criminal Investigation, and California Department of Insurance are actively investigating the case.
Read more about this case here.
For more information on the latest developments regarding the Subsequent Injuries Benefits Trust Fund, stay updated through SIBTF.org. We provide essential news and updates that help ensure compliance and transparency in the workers’ compensation system.
Read More from SIBTF.org:
- Doctor Pleads Guilty to Writing SIBTF Reports After Suspension
- California Employers Face Mounting SIBTF Liabilities
- California’s Subsequent Injuries Benefits Trust Fund
FAQs: What is SIBTF fraud?
What is SIBTF fraud and how does it occur?
SIBTF fraud involves intentionally submitting false or misleading claims to the California Subsequent Injuries Benefits Trust Fund. This often includes falsified medical evaluations or misrepresented impairments to obtain unearned payouts.
Who were the key individuals involved in the $3M SIBTF fraud case?
The main individuals involved were Kevin Tien Do, a previously suspended physician, and Israel Claustro, an attorney turned Orange County Superior Court judge. Together, they submitted fraudulent reports to SIBTF through Liberty Medical Group.
What are the legal consequences of SIBTF fraud in California?
SIBTF fraud is a federal offense. Perpetrators may face charges such as wire fraud, conspiracy, and tax evasion. In this case, the physician faces up to 20 years in prison, alongside IRS and FBI investigation.
What is SIBTF?
The Subsequent Injuries Benefits Trust Fund (SIBTF) helps California workers who suffer a new workplace injury and already had a prior disability. It offers supplemental compensation when combined impairments severely limit earning capacity.