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An Advantage Over Other Fraudsters

Senior Director of Strategic Alliances
LexisNexis Risk Solutions - Government

Reyes De La Cruz had an advantage over the other fraudsters who were stealing identities and filing bogus COVID-19 Unemployment Claims. De La Cruz was gainfully employed by the Washington State Employment Security Department as an unemployment insurance specialist. Apparently no one was reviewing his work, making it easy for our fraudster to capitalize on two schemes to steal from taxpayers.

De La Cruz was hired by ESD in April 2020 to help process the unprecedented numbers of pandemic-related unemployment insurance claims. While sitting at his desk, De La Cruz accepted bribes in exchange for engineering benefit payments for his friends, family, or acquaintances by making false entries in the claims database. De La Cruz manipulated the data so that claimants received lump sum retroactive payments that sometimes amounted to tens of thousands of dollars. The claimants would then pay De La Cruz a portion of the lump sum. De La Cruz wasn’t someone to mess with though. In some instances, when claimants refused or resisted paying De La Cruz, he threatened to terminate the claims if they did not pay him.

In between filing claims and threatening his victims, De La Cruz also filed at least four claims using stolen identities and then had the benefits paid to debit cards he owned. He even tried to maximize those fraudulent payments. After he was terminated in October of 2020, he attempted to restart claim payments to those stolen identities going as far as to impersonate a claimant in phone calls with ESD and a bank.

De La Cruz’s arrest in September 2021 raised questions over ESD hiring practices. ESD screens candidates for any history of unemployment fraud but what they don’t do is a full criminal investigation. When he was hired by ESD, De La Cruz was facing 2019 charges for felony theft and bail jumping, but he wasn’t convicted until May 2020, one month after starting at ESD. De La Cruz’s also criminal history includes a 2016 misdemeanor assault conviction.

Great job by the FBI in this investigation and a shout out to the Attorney General for building the case. De La Cruz pleaded guilty to three federal felonies for his scheme to fraudulently distrivute at least $360,000 in unemployment benefits.

Today’s Fraud of the Day is based on an article “Ex-Washington state employee pleads guilty to pandemic fraud” published by KOIN Portland on June 23, 2012

Prosecutors say a former employee of Washington state’s Employment Security Department has pleaded guilty to three federal felonies.

Reyes De La Cruz III of Moses Lake pleaded guilty Wednesday to crimes in which he exploited his employment for personal enrichment and fraudulently distributed at least $360,000 in pandemic-related unemployment benefits, according to Acting U.S. Attorney Nick Brown. De La Cruz reportedly personally enriched himself by at least $130,000.

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