Fraudulent Unemployment Insurance Claims Increased during the Pandemic

 

By Chujun Tang

 

FRESNO, CA – Eight defendants have been charged with a 25 million dollar unemployment insurance fraud scheme. Daryol Richmond, 31, an inmate at Kern Valley State Prison, pleaded guilty on Tuesday as the first defendant.

 

According to court documents, Richmond obtained personal information from other individuals, including inmates and non-inmates, without permission. He provided the information to his co-conspirators, who then duped the California Employment Development Department (EDD) into stating that the inmates previously worked as clothing merchants, handymen and other jobs, and recently became unemployed due to the COVID-19 pandemic.

 

The defendants made fraudulent claims through fictitious email accounts and phone calls. After receiving the money, they made cash withdrawals at different places and times to avoid suspicion.

 

Richmond faces up to 20 years in prison and a 250,000 dollar fine. If convicted of the aggravated identity theft, he and his co-conspirators face a mandatory two-year consecutive sentence.

 

Other defendants in this case include Telvin Breaux, 29, an inmate at the California Correctional Institution in Tehachapi; Holly White, 30, of Los Angeles; Cecelia Allen, 33, of Downey; Fantasia Brown, 33, of Los Angeles; Tonisha Brown, 28, of Los Angeles; Fantesia Davis, 32, of Victorville; and Shanice White, 28, of Hawthorne.

 

Coincidentally, last month, Idowu Hashim Shittu, 45, a Castro Valley resident, allegedly obtained more than one million dollars in CARES Act unemployment benefits by impersonating other people. Like Richmond, Shittu used others’ personal information to receive benefits through the Coronavirus Aid, Relief, and Economy Security Act from multiple state agencies. 

 

“Since then, many state authorities responsible for distributing those unemployment benefits to their residents have been inundated by fraudulent claims,” prosecutors said in a statement. “According to the complaint’s allegations, Shittu fraudulently submitted requests for such benefits and then used some of those proceeds for his own personal gain.”

Earlier this month, a former EDD employee was sentenced to 63 months in federal prison for her involvement in a 4.3 million dollar fraudulent unemployment benefit scheme. Gabriela Llerenas, 44, of Perris, “took advantage of the expanded eligibility for unemployment insurance benefits” made possible by the 2020 CARES Act, according to the U.S. Attorney’s Office for the Central District of California.

The three cases, however, were just one small piece of the massive fraud increase which scammed at least 20 billion dollars in unemployment benefits intended for California workers during the COVID pandemic.

 

The records seem to show that it was a simple process to get money from the EDD, which has been inundated with unemployment claims at an unprecedented rate since 2020. A probation officer wrote, “She [a fraud claim defendant] was called on the phone, an interview was done, and they gave her unemployment…the card came to her.”

 

The California Department of Corrections and Rehabilitation estimated at that time that as many as 36,000 prison inmates could have been involved in the scam, diminishing any hope of retrieving funds.

Inmates involved had additional time tacked on their sentences, usually a few years. Defendants are also on the hook of restitution to the state – but that’s unlikely, especially for inmates serving years in prison, Deputy District Attorney Damon Mosler said, “the money is gone.”

 

About The Author

Jordan Varney received a masters from UC Davis in Psychology and a B.S. in Computer Science from Harvey Mudd. Varney is editor in chief of the Vanguard at UC Davis.

Related posts

Leave a Reply

X Close

Newsletter Sign-Up

X Close

Monthly Subscriber Sign-Up

Enter the maximum amount you want to pay each month
$ USD
Sign up for