Jobless Benefits Scam Involving Prison Inmates Cost California Hundreds of Millions

Inmates at Oak Glen Conservation Fire Camp # 35 Prison in Yucaipa, Calif., November 6, 2014 (Lucy Nicholson / Reuters)

An unemployment insurance scam that used the names of prisoners to claim unemployment benefits in California could have cost the state as much as $ 1 billion, an enforcement task force said on Tuesday. the law led by California district attorneys.

A total of 35,000 unemployment claims were filed using the names of inmates at California State Prison, and more than 20,000 of the claims were paid, totaling at least $ 140 million in benefits, the prosecutor said. from the Sacramento County District, Anne Marie Schubert. The scam targeted pandemic-related unemployment assistance provided by the California Department of Employment Development. The biggest complaint made was $ 48,600 and in some cases multiple claims were made on behalf of a single inmate.

“The fraud is honestly astounding,” Schubert said, adding that the scheme could be “the biggest taxpayer money fraud in California history.”

Fraudulent claims have been filed under the names of several convicted serial killers, Scott Peterson, who was convicted of murdering his pregnant wife and unborn son, and at least 133 prisoners on death row, including Isauro Aguirre, who along with his girlfriend tortured and murdered her. 8 year old son.

Most complaints have been paid in the form of prepaid debit cards sent to addresses listed on unemployment insurance claims, funds which were then deposited into inmate accounts, although in some cases benefits from claims were sent directly to prisons and prisons. Sometimes the benefits even end up in the hands of relatives and friends of inmates outside of prisons.

“The vast majority of this money will never be returned,” El Dorado County District Attorney Vern Pierson said.

Schubert said fraudulent claims may have become rampant because California does not have a system that “matches” an individual’s prison information with their unemployment insurance claim.

Gov. Gavin Newsom issued a statement commending district attorneys for their work in exposing the fraud and said his office of emergency services would form a task force to coordinate efforts to tackle the problem.

“Unemployment fraud in local, state and federal prisons is absolutely unacceptable,” the Democratic governor said.