Credit Union Catches Criminal

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Unemployment claim form on an office table.

Jerry Johnson, 54, of Webster City, Iowa, was sentenced to federal prison for using his credit union bank account to obtain unemployment insurance money he did not qualify for. (He had this great idea to scam as many states as possible since their unemployment agencies were overwhelmed with many people filing for unemployment during the COVID-19 pandemic across the nation. He probably figured the agency employees would be overworked and not paying attention to the details.)

In May 2020, $31,000 in unemployment funds from the State of Washington were deposited into Johnson’s credit union bank account. These funds were sent in the names of other people. (That was probably the first red flag.) Johnson withdrew the money and mailed the cash to his partners in the scheme. (Maybe their mail chain can continue on as pen pals in prison.)

The Commonwealth of Massachusetts tried to deposit more than $20,000 in fraudulent unemployment benefits into Johnson’s bank account. (Luckily, the credit union suspected something fishy and returned the money from the transaction.)

On January 28, 2021, Johnson pleaded guilty to one count of mail fraud. He was sentenced on July 1, 2021 to eight months in federal prison. He must also pay $31,062 in restitution to the State of Washington. After his release from prison, Johnson will have two years of supervised release.

While the COVID-19 pandemic offered another way for unscrupulous individuals to take advantage of government benefits, the Department of Justice (DOJ) was one step ahead. The COVID-19 Fraud Enforcement Task Force partners with agencies across government to enhance enforcement efforts against COVID-19 related fraud. This case is a good example of the DOJ’s commitment to holding hundreds of bad actors accountable for their illegal actions.

Today’s Fraud of the Day comes from a Department of Justice press release, “Iowa Man Sentenced to Federal Prison for his Role in COVID-19 Unemployment Insurance Fraud,” published on date.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.