SACRAMENTO – On March 26, 2019, John Michael Herron II, 36, of Stockton, pleaded guilty to mail fraud and aggravated identify theft in connection with an unemployment benefits fraud and identity theft scheme.
“The hard-working citizens of California don’t take kindly to unemployment fraud,” said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona. “Unemployment benefits are for those who need assistance while in between jobs. I applaud the investigators at the State of California Employment Development Department (EDD) who investigate the unscrupulous individuals who steal from this fund and assist prosecutors in the pursuit of justice.”
According to court documents, for more than four years ending in January 2018, Herron took part in a scheme to defraud the State of California Employment Development Department (EDD) by filing fraudulent claims for unemployment insurance benefits. Herron, and another man, created fictitious companies and fictitious employees. They would then use the real identities of people, with and without their knowledge, to file claims with EDD, falsely stating that the employees had been laid-off or fired. The unemployment benefits were deposited onto debit cards that were mailed to addresses controlled by Herron and associates. In at least one instance, ATM cameras captured Herron withdrawing unemployment benefit funds using a debit card registered to an identity theft victim. Herron was connected to approximately $578,185 in fraudulent claims to EDD, of which approximately $485,685 was paid.
Herron is scheduled to be sentenced on July 2, 2019. He faces a maximum statutory penalty of 20 years in prison and a $250,000 fine for the mail fraud count, and a mandatory two-year consecutive sentence and $250,000 fine for the aggravated identity theft count.
This case is the product of an investigation by the U.S. Department of Labor Office of Inspector General, the Federal Bureau of Investigation, and the California Employment Development Department’s Investigation Division. Assistant U.S. Attorneys Amy Schuller Hitchcock and Shelley D. Weger are prosecuting the case.