Unemployment Insurance Fraud in San Diego
Unemployment insurance aims to help people who lose their jobs -- through no fault of their own -- to keep their heads above water for at least one year while they actively continue to seek new employment. Beneficiaries receive payments ranging from $40 to $450 per week. In California, the Employment Development Department (EDD) runs the program.
In order to qualify for unemployment benefits, you must:
- Be unemployed (you must wait to file a claim until you are actually no longer working - you cannot file in anticipation of your last day of work), or have had your hours involuntarily reduced to less than full-time;
- Be actively looking for work;
- Be ready and physically able to work immediately; and
- Have worked in the last 18 months.
Because of this, persons who commit unemployment insurance fraud might face serious consequences.
Unemployment Insurance Fraud
This is the act of collecting unemployment insurance benefits based on providing false, misreported, or unreported information to the Employment Development Department. Common examples include: you return to work but continue to collect unemployment benefits without reporting the work and wages, you do not report wages during the week that the work was performed, you work a part-time job but do not report your earnings, so you are collecting more benefits than you are allowed, you perform temporary work while collecting unemployment benefits, but do not report these earnings when certifying for benefits, and/or you withhold information or give false information when filing an unemployment claim or certifying for benefits.
The specific legal jargon for unemployment insurance fraud is: "willful false representation, knowing concealment, or false identification to obtain, increase, reduce, or defeat any benefit under the state or federal programs,” according to the California Unemployment Code 2101 and the California Penal Code 550.
Investigation Process for an Unemployment Insurance Fraud in San Diego
California’s EDD is the agency responsible for conducting suspected unemployment insurance fraud allegations. Once fraud is suspected, EDD's fraud investigation unit takes over and looks into the allegations. If they uncover enough evidence to convince the local prosecuting agency to file criminal charges, they submit their report to that agency. If they believe that the claim will get rejected, they simply retain their file in case they are able to obtain additional evidence against the suspect individual. People caught cheating the system subject themselves to hefty fines and/or potentially lengthy incarceration sentences.
Penalties for Unemployment Insurance Fraud
Unemployment insurance fraud is a “wobbler” offense, meaning it can be charged as either a misdemeanor or a felony. This all depends on the defendant’s criminal history and the circumstance surrounding the particular charge(s), and the prosecutor’s discretion.
If charged as a misdemeanor, you face up to one year in a county jail and a maximum fine of $20,000. If convicted of this offense as a felony, you face imprisonment in California state prison for 16 months, two or three years, and a maximum $20,000 fine.
Penal Code 550 specifies which forms of insurance fraud qualify as a misdemeanor or a felony. California unemployment insurance fraud may qualify as a misdemeanor if the amount of the alleged fraud is $950 or less. When this is the case, a conviction subjects you to up to six months in a county jail and a maximum $1,000 fine. If the amount exceeds $950, the crime is a wobbler. If the amount exceeds $950 (and you are convicted only as a misdemeanor) your potential jail time increases to a maximum one-year sentence and your fine increases to a maximum $10,000. A felony conviction carries the more severe punishment of two, three, or five-year jail sentence, and either a maximum $50,000 fine OR double the amount of the fraud, whichever is greater.
Related Offenses to Unemployment Insurance Fraud
Unemployment insurance fraud frequently involves allegations of theft, forgery, and perjury, prosecutors may file the following charges in addition to or in lieu of unemployment insurance fraud.
California Penal Code 487 prohibits unlawfully taking another person’s/entity’s property. This means that if you fraudulently obtain unemployment benefits that total more than $950, prosecutors could charge you with this wobbler, punishable by up to three years in jail and a maximum $10,000 fine.
California Penal Code 470 for altering a written document to commit fraud, you could potentially face an additional three years in jail and a maximum $10,000 fine. This is related to unemployment insurance fraud when you sign someone else’s name to an application or sign as a supervisor when you are not, for example.
California Penal Code 118 punishes perjury (lying under oath) could subject you to up to four years in county jail and a maximum $10,000 fine. So, if you submit an unemployment insurance application in a false name, with a false social security number, or intentionally falsify any other information in your application, prosecutors could charge you with perjury as well.
How can you prove you are not guilty of committing an unemployment insurance fraud?
Luckily, you have the option to contact a skilled criminal defense attorney who knows which, of the several, available defenses will be most beneficial to your case. The most common legal defenses are:
- Lacked Fraudulent Intent
For example, if you believe you submitted a legitimate claim, or accidentally provided the wrong information (for example inadvertently writing an incorrect social security number), or didn't realize that you needed to report freelance income to the EDD you do not present the requisite intent to be guilty of the crime. The prosecutor will have no convictable case.
- Insufficient Evidence
For example, suppose you are an employer charged with knowingly withholding deductions from employees and willfully failing to pay them to the EDD. Now, if you don't personally manage the "books" or payroll issues, you may not have noticed that the individual who does has actually withheld the deductions (which could be a violation of California Penal Code 503). If the prosecutor doesn't have enough evidence to tie you to the crime, you should be acquitted of the charge based on insufficient evidence.
- Falsely Accusation
For example, even if there are legitimate claims of unemployment insurance fraud, it doesn't necessarily mean that you are the guilty party. Perhaps someone in your office filed for a fraudulent claim and, when questioned, tried to escape his own liability by pointing the finger at you. Or perhaps you were the victim of identity theft and, as a result, you were also the victim of mistaken identity, since you are not the culprit who submitted the false claim.
Your Best Defense against Unemployment Insurance Fraud Charges in San Diego
If you are charged with unemployment insurance fraud, especially if you are facing a felony charge, the best thing you could do is find a skilled criminal defense attorney, particularly find a local criminal defense attorney who knows the local San Diego judicial system. Local criminal defense attorneys know how local judges and local prosecutors work and can use that knowledge to better represent you. While this may sound easy, but the reality is quite complicated. To make sure you get the best legal scenario possible, you should talk to a skilled criminal defense attorney with experience in tackling fraud cases in San Diego, from real estate fraud cases to unemployment insurance fraud cases. Call the Monder Law Group today for more information.