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Neither snow nor sleet nor rain nor incarceration can keep some dedicated scammers from launching a fraud. Inmate Sholanda Thomas and parolee Christina Smith were indicted for allegedly cooking up a scheme to take advantage of the COVID-19 boost in unemployment benefits at the Central California Women’s facility.

Thomas purportedly obtained other inmates’ names and personal information and conveyed it to Smith, along with Thomas’ own information. Smith then used the information on applications for unemployment benefits that stated that the women had worked as hairstylists, barbers, and in other occupations, and that they were available to work. (A bit of a stretch, inasmuch as they were in the slammer.) 

California’s Employment Development Department paid more than $250K in fraudulent claims, with Smith purportedly splitting the proceeds with Thomas. Smith used unemployment benefits to get plastic surgery, keeping Thomas’ share in a shoebox for her release from prison. (Which, if Thomas is convicted, may not be real soon, but nice thought.)

Smith has pleaded guilty to conspiracy and aggravated identity theft charges, with sentencing in August. She faces a maximum of 20 years in prison and a $250K fine for the COVID-19 unemployment conspiracy charge. There is a mandatory two-year sentence, consecutive to any other sentence, for the aggravated identity theft count, and a fine of up to $250K. (Not to mention that the parole violation may add a little something to her prison term.) 

Today’s Fraud of the Day comes from a press release from the U.S. Attorney’s Office for the Eastern  District of California, “Parolee Pleads guilty to Jailhouse COVID-19 Unemployment Benefits Fraud,” dated June 1, 2021.

FRESNO, Calif. — Christina Smith, 38, who was on parole and had previously been incarcerated at the Central California Women’s Facility (CCWF) in Chowchilla, pleaded guilty in federal court today to conspiracy and aggravated identity theft charges for the submission of fraudulent unemployment insurance claims to the California Employment Development Department (EDD) in the names of current CCWF inmates, Acting U.S. Attorney Phillip A. Talbert announced.

According to court documents, Sholanda Thomas, 37, a current CCWF inmate, sent her own and several other inmates’ personal identifying information to Smith to submit the unemployment insurance claims in their names. The underlying applications represented that the inmates had been working various jobs, which was untrue because they were incarcerated and therefore ineligible for benefits. The loss to the EDD and the United States is over $250,000. Smith split the proceeds with her co-conspirators.

Additional information is from an ABC10 article, “Over $400,000 allegedly lost to two EDD fraud schemes involving COVID-19 unemployment benefits,” dated December 17, 2020.

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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.