By Maya Mellberg
October 13, 2020
Investigators unraveled an unemployment fraud scheme leading to the arrest of 89 individuals within the first 25 days of September. As investigators dig deeper, they expect to make many more arrests in the next few months.
The immense impact of COVID-19 led to extreme percentages of unemployment all across the country. This led to many in need applying for unemployment funds from the government but many people decided to take advantage of the government’s efforts to help those without income. Scammers have created complex profiles and identities to reap the benefits of the unemployment funds illegally. Efforts to increase the speed of delivery of these benefits led to a less secure system where criminals found loopholes to gain unemployment funds.
181 debit cards were found in Beverly Hills, some of these cards carrying over $20,00 each with their combined values totalled over 3.6 million dollars. The suspects carrying these cards were also found with $289,000 in cash, as well as seven handguns.
These suspects spent their unemployment benefits on luxury rentals, cars, dinners, and merchandise.
It was discovered that many suspects had come into California from out of state to apply for unemployment and use false or stolen identities. They would take the identities of the deceased, living in nursing homes, or incarcerated. The EDD warns “Scammers are using a complex profile of stolen personal identifying information most likely obtained from national and global data breaches”.
The California Employment Development Department was to be shut down for two weeks in order to improvise their services and prevent criminals from taking money from those who truly need it.
As investigators continue to find and arrest those manipulating the unemployment benefits and using identity theft to reap the benefits, they are uncovering huge schemes set to manipulate the government to give money to those who are using it solely to their advantage.