One month after announcing it planned to spin off Concentra Group Holdings Parent, Inc. (CON), a provider of occupational health services, Select Medical Holdings (SEM) disclosed the subsidiary was the target of a whistleblower fraud probe.

In the two quarters since Select rid itself of the fraud probe, Concentra has provided no update other than the same disclosure Select made prior to the spin-off:

“On February 5, 2024, the Company received a subpoena from the California Department of Insurance relating to an investigation under the California Insurance Frauds Prevention Act, Cal. Ins. Code § 1871.7 et seq., which allows a whistleblower to file a false claims lawsuit based on the submission of false or fraudulent claims to insurance companies. The subpoena seeks documentation relating mainly to the Company’s billing and coding for physical therapy claims submitted to commercial insurers and workers’ compensation carriers located or doing business in California. The Company has produced data and other documents requested by the California Department of Insurance and intends to fully cooperate with this investigation. At this time, the Company is unable to predict the timing and outcome of this matter.”

If the California investigation bears fruit, investors should expect more trouble.

Concentra is the largest provider of occupational health services in the United States with 549 centers and 156 onsite clinics at employer worksites in 42 states.

Select Medical owns 81.74% of Concentra’s shares.

If that changes— and Concentra is severely penalized for fraud— investors will have no one to blame but themselves considering the company’s ill-chosen ticker symbol (CON).