The case is ongoing, but already investigators with the California Employment Development Department (EDD) have an impressive tally as they continue to uncover an unemployment fraud scheme in Northern California that cost tax payers $5 million dollars.
“Shame on those who meticulously and maliciously take advantage of a system that’s designed to help the disadvantaged, people out of work,” said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona. “CSLEA represents some of the best law enforcement officers and investigators in the state and this case is a prime example. Our investigators with EDD should be very proud of their work. “
That work resulted in several federal grand jury indictments and 21 people who are now charged in a case that could send some of the accused to prison for 20 years.
The most recent indictment included nine defendants from Yuba City, Roseville and Ceres. Some of the accused were selling fraudulent paystubs for cash while others were buying the stubs to cash in on unemployment insurance benefits. According to prosecutors, at times, those selling the paystubs would teach the buyers how to use them at EDD.
Federal prosecutors believe those who bought the fraudulent paystubs paid $250 for every $1,000 they collected in bogus wages. This resulted in more than 2,000 fraudulent claims for unemployment and disability benefits. The loss in this case is more than $5 million.
The EDD investigators on this case are members of the California Association of Fraud Investigators (CAFI), an affiliate of CSLEA.
“The criminal investigators for EDD work very hard in fighting fraud in unemployment insurance, disability insurance and employer tax evasion,” said CAFI board director for EDD Daniel Schmidt. “The criminal investigators for EDD enjoy what they do and continue to fight for taxpayers. As criminal investigators, they attempt to stop all illegal payments and bring the offenders to justice.”