CA Inmates May Have Stolen $1 Billion in Unemployment Aid

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Sophisticated crime rings involving California prison and jail inmates may have stolen upwards of $1 billion in pandemic unemployment aid, four district attorneys and a federal prosecutor said Tuesday. Some  35,000 unemployment claims were filed in the name of California inmates between March and August, including that of convicted murderer Scott Peterson, and at least 20,000 had been paid out, said Sacramento County District Attorney Anne Marie Schubert, reports Politico. She called the scale of the scheme “honestly staggering” and said it could amount to “the biggest fraud of taxpayer dollars in California history.” Law enforcement officials called on the state to ensure that the identities of claimants are routinely cross-checked against those who are incarcerated and halt those payments.

“It’s not just about the money that’s been stolen,” Schubert said. “It’s about the fact that we need to turn off the spigot, which means that we should not continue to pay these convicted felons who are in prison. … We have asked and implored [Gov. Gavin Newsom] to get involved himself to turn the spigot off.” The investigation involved district attorneys from Sacramento, El Dorado, Kern and San Mateo counties and McGregor Scott, U.S. Attorney for Eastern California. Newsom directed officials “to take immediate actions to prevent fraud and to hold people accountable when fraud is not prevented.” For months, fraudsters have exploited programs designed to distribute federal pandemic aid quickly to self-employed and contract workers through a self-certification process. Federal officials warned state agencies this fall that cybercriminals in the U.S. and abroad — using troves of personal information mined from massive data breaches — may have pocketed $8 billion in pandemic aid. Lawmakers and advocates for low-wage workers are concerned that an emphasis on fraud prevention has needlessly added legitimate claimants to the state’s backlog of unpaid claims, which reached 1.6 million this fall.

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