California State Employment Development Department (EDD) and UI Fraud
Federal and state funding provided quick and easy ways for people to obtain thousands of dollars of essentially “free” money from simply filling out an online application. There was no time to screen the applications or make the application process difficult. Because of this, it became an open invitation for people to make claims that were not really qualified to receive benefits. Some people thought they were helping by signing up family members, grandparents, brother and sisters, neighbors and friends, and they made mistakes by putting themselves in jeopardy by claiming benefits they were not really entitled to. Others, feeling the pressure and fear of the shutdown and the pandemic, took advantage of these situations because they were desperate or thought that there was so much excess, that there would not be consequences.
In Washington D.C. on September 1, 2020, the Office of the Inspector General (OIG) of the Department of Labor announced the release of $100,000,000 to the States to detect, prosecute and prevent fraud and misuse committed against state Unemployment Insurance (UI) agencies. This includes the new UI programs under the Coronavirus Aid Relief and Economic Security Act (CARES). The bottom line is, they are aggressively coming after people who claim multiple benefits or benefits for others. The IRS, federal agencies like the FBI, and state and local officials are sending their agents and officers to arrest and prosecute people who have done this. People are often cashing out these benefits or are engaging in conduct believing they are acting legally when such activities could likely be classified as money laundering.
If you or someone you love or care about has engaged in these activities either accidently or deliberately, you should seek legal guidance immediately as you are at risk of prosecution. As officers of the court, we always advice people to obey the law and seek legal counseling before making mistakes or breaking the law. In practice, people usually contact us after they have made these mistakes or committed these acts. We are here to help, advice and protect you. If you are fearful that you may have done something or you have been contacted by authorities, you should seek legal counsel immediately. There are many qualified criminal lawyers in California who can assist you. Free consolations are often given, and ethical attorneys will provide honest advice regarding whether you need representation or not. If you need representation, we are here to help you at the Law Offices of Jeffery K. Rubenstein.
Examples of EDD Fraud
The EDD provides a variety of unemployment and support services to people who have lost their jobs, had their hours reduced, been furloughed or had their businesses affected due to the impacts of COVID-19 in California. The OIG has awarded the EDD $2,500,000 to combat UI fraud based on false, misreported or unreported information. Here are some examples of UI fraud.
· Enrolling ineligible family members with EDD, such as grandparents, who do not qualify for UI.
· Withholding information or giving false information to EDD when filing a UI claim.
· Not reporting to EDD wages during any week work was performed.
· Returning to work but keep receiving EDD benefits without reporting the work and wages.
· Working a part-time job but not reporting earnings to EDD.
· Performing temporary work while collecting UI benefits, but not reporting these earnings.
Since the advent of COVID-19 pandemic, almost all fraud claims involve an aspect of cybercrime. EDD detectives investigate UI fraud quite aggressively and the FBI is investigating cybercrimes in relation to UI fraud across the USA. Although being accused of committing UI fraud or cybercrime could be stressful and cumbersome, Jeffery K. Rubenstein believes many of these mistakes are defensible with proper legal assistance.