Biding Time

Confident woman is leaving company, ready to find new job. She carries her belongings in a cardboard box.

While fraudsters are generally selfish and greedy people, they tend to be very patient when orchestrating a scam. A San Francisco Bay area resident bided his time while secretly working to steal a quarter of a million dollars in an unemployment insurance fraud scheme. (Fortunately, the investigators in this case are also good at biding their time and choosing the right moment to catch criminals. Otherwise, you wouldn’t be reading about today’s offender.)

Thanks to a joint investigation carried out by the California Department of Insurance, Employment Development Department and the U.S. Department of State Diplomatic Security Service (DSS), it was discovered that the defendant used a fake passport, Social Security card, plus falsified proof of employment documents to sign up for multiple insurance policies. The Department of Insurance investigators found that the fraudster lied about personal information and used different names to obtain the numerous policies. (He probably assumed that his scam would not be traceable back to one person. He was wrong.)

According to the article, the defendant took his sweet time in submitting bogus claims to the insurance company. (He didn’t want anyone to become suspicious.) It wasn’t long before he had collected $128,753 in unemployment benefits he did not qualify for. (Supplemental unemployment insurance can be obtained to help pay the bills when an individual becomes unemployed due to no fault of their own.)

Even though the man from San Francisco carefully took his time when submitting unemployment claims as to not be caught, the investigators on the case eventually tracked him down. (Timing is everything.) After the 41-year-old was federally indicted on six charges related to unemployment insurance fraud, he fled to Georgia. While there, he was apprehended by DSS agents. (Proving that you can run, but you can’t hide.) He has since been extradited back to California.

The San Francisco fraudster pleaded guilty to unemployment insurance fraud. When sentenced, he could receive up to two years in federal prison, three years of supervised release and will probably pay $259,596 in restitution. (Wouldn’t it have been easier to just get a real job?)

Today’s “Fraud of the Day” is based on an article, “A Bay Area resident pleads guilty to fraudulent claims,” posted on on July 7, 2019.

SAN FRANCISCO (KRON) – An insurance scheme, now has a Bay Area man pleading guilty to federal charges of $250,000.

Kenneth X. Huang, 41-years-old, was federally indicted on six federal charges related to insurance fraud. Investigators discovered a convoluted unemployment insurance scheme, that’s now steered him to serving prison time.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.