As an employee, you could face criminal charges if you provide incomplete or false information to obtain or seek unemployment benefits that you are not rightfully entitled to. As an employer, you could face criminal charges when you supply incorrect information enabling a former or current employee to be denied their rightful employment benefits. Unemployment insurance benefits fraud is widespread in California and other states. But the state has stringent laws providing stiff penalties for those found guilty. Consequences for this fraud-related offense could include a lengthy prison time and hefty fines.
It is advisable to partner with a competent criminal attorney if you face unemployment insurance benefits fraud charges in Riverside, CA. Your attorney will fight alongside you for a fair outcome of your case. Talk to us at Riverside Criminal Defense Attorney Law Firm to understand your options. We offer quality legal advice and assistance to all our clients.
California Unemployment Insurance
Unemployment insurance is a federal and state program that the Employment Development Department runs in California. It was founded in 1935 and is funded by employers through tax contributions. The program aims at helping employees that lose their employment through other means and not their fault. The money enables them to cater to their personal needs as they actively seek new jobs or another source of income. Those who benefit can receive up to $450 per week, depending on their individual needs.
However, you must be eligible for unemployment insurance benefits to receive financial assistance from the government when you lose your job. The qualification criteria include:
- The applicant must be out of work at the time of the application. You cannot apply for unemployment benefits until you're entirely out of a job or have significantly reduced working hours.
- The applicant must be actively searching for a job — You cannot depend on benefits for a long time.
- You should be physically ready and able to take a job immediately.
- You must have been in employment at least for the last eighteen months.
The main requirement for unemployment insurance applicants is that they must not have deliberately lost jobs. The law requires applicants to have lost jobs through other means and not their fault. However, the California Employment Development Department is a little lenient and would be willing to consider individual reasons for being fired from or quitting their jobs. Thus, you could be eligible for unemployment benefits if you were fired or resigned under exceptional circumstances.
Sadly, some people take advantage of these benefits to gain or deny deserving applicants unlawfully or undeservedly. Consequently, employers bear the cost. It also causes a delay within our system whereby deserving applicants are made to wait longer than they should receive benefits to help them deal with their immediate needs after losing their job.
What Unemployment Insurance Benefits Fraud Entails
Unemployment insurance benefits fraud occurs when a person willfully and knowingly provides false information, false identification, or conceals information to obtain, reduce, or deny unemployment benefits under the federal and state program. It is a fraud-related offense regulated under the California laws by the state Unemployment Insurance laws. Anyone found guilty of UI benefits fraud faces prosecution and can receive a stiff penalty comprising years in prison and a hefty fine.
The Employment Development Department runs the California unemployment benefits program. The department receives applications from ex-employees who seek financial assistance before finding another job. The department also conducts investigations on suspected cases of unemployment benefits fraud. If the department receives a suspicious application, it performs an investigation before qualifying or disqualifying the applicant.
Sometimes the department acts on information received from public members regarding fraudulent applications or activities by ex-employees or employers. Most of the information the department receives comes from:
- Members of the public through a hotline number and 'report fraud' online page managed by the department
- From field officers sent by the department to collect information regarding unemployment benefits applicants — For instance, if the department receives incomplete, conflicting, or suspicious information from an applicant, its field officers must investigate it first before the department can act on the request.
If an applicant is suspected of fraud, EDD officers will forward the information they have gathered to the fraud investigating unit of the department. The unit handles the matter to ensure that they have concrete information before taking legal action. Once the fraud investigating unit has sufficient evidence to file a criminal charge against the suspect, they will submit their findings to the department, filing criminal charges against the defendant.
However, if the investigation unit does not uncover sufficient evidence, it will keep that file until it obtains all the information needed to file a criminal charge against the defendant.
How Employers and Employees Commit Unemployment Insurance Benefits Fraud in California
Both employers and employees can face charges for unemployment insurance benefits fraud in California. The offense can be committed in several ways, depending on whether you are an employee or employer.
Here are ways through which an employee can commit unemployment insurance fraud:
Collecting Benefits While Still Employed
It is prevalent to see employees applying for unemployment benefits while still working. While it could seem like a way to supplement your income, especially if you earn less than your needs, collecting unemployment benefits while still working could cause you serious legal problems. The law requires you to only apply for benefits when you lose your job through someone else’s fault. Notify the department once you land another job so that another needy person can benefit. Failing to do so could result in a criminal conviction, leaving you serving time in jail/prison and paying a hefty fine.
Collecting Other Benefits Alongside Unemployment Benefits
Unemployment benefits provide a temporary means of livelihood to ex-employees who have lost their jobs and do not have a means of catering to their needs until they find another employment. If you are already receiving other benefits like workers' compensation and pension, you must notify the department. Failing to do so could result in criminal charges.
Submitting False Information When Applying for Benefits
Applicants must provide correct identifying information like their names, social security numbers, and employment details when applying for unemployment benefits. Using a fake name or any other false information to receive benefits falsely is fraudulent. Additionally, using another person's name or any additional identifying detail like their employment details and social security number could result in identity theft charges.
Applying for Benefits in a Different State
You only qualify for UI benefits in your state of residence. Applying for benefits in a different state or California while living in another state is fraudulent.
Cashing Another Person's Unemployment Benefits Check
You can only take and cash an unemployment benefits check under your name. If you are genuinely out of employment and have applied for unemployment benefits, you can cash your check immediately you receive it after approval. If you receive a check under someone else's name or come across another person's check, it will be illegal to cash it without their consent.
Lying About Work-Search Effort When Applying for Benefits
It is challenging for EDD to confirm that you are actively looking for employment when approving your unemployment benefits application. Many people take advantage of that to enjoy free money while doing nothing to look for employment. Employment benefits should help you only when you have lost your job right before you find another. If you have no plans to look for a job, you do not qualify to apply for these benefits.
Providing False Information as to Why You Are Unemployed
Remember that you qualify for UI benefits if you lose your job through a fault, not your own. Employees who lose jobs due to their own fault, like underperformance, missing work for no good reason, falsify information to receive unemployment benefits. If you were fired from work, you must provide truthful information. Otherwise, you could face serious criminal charges once EDD uncovers the truth.
How Employers Commit UI Fraud
Employers, too, could face charges for UI benefits fraud if they:
- Intentionally withholding deductions from their employee's paycheck and failing to pay the money to EDD.
- Knowingly providing untrue information to EDD, like an employee's wage or why the employee was laid off, to not contribute to the program.
Your Defense Attorney Can Help You
A small mistake in your application for unemployment benefits could cause you great trouble if it is considered fraudulent under the state Unemployment Insurance Code 2101. Many defendants are caught in surprise without knowing that their actions could result in serious criminal charges. Fortunately for you, the law provides several defense strategies that your criminal defense attorney can use to defend you against fraud charges. If your attorney's strategy is accepted in court, the judge would dismiss or reduce your charges for a fair outcome of the situation. Some defense strategies that could apply in your case are:
You Did Not Have Fraudulent Intentions
California fraud laws require you to act with a fraudulent intention to be found guilty of fraud. Unemployment insurance fraud has fraudulent intent as one of its elements. The prosecutor must prove beyond a reasonable doubt that you did what you did with dishonest intention. A fraudulent intention means that you behaved that way to benefit from unemployment insurance unlawfully.
You can use this defense if you are sure that you filed a genuine claim for unemployment benefits or you accidentally provided false information in your application, like a wrong SSN. For instance, if you were freelancing after losing your job and had no idea that you were required to disclose the freelancing job to EDD, you would not be guilty of fraud. Only a person that intentionally acts with fraudulent intention is guilty under this law.
Insufficient Evidence to Convict You Of Insurance Fraud
People commit insurance fraud nowadays more than they did in the past. They have mastered the art of falsifying information and tricking the system into benefiting from insurance benefits unlawfully. People who smartly commit fraud can quickly get away with it due to insufficient evidence to convict them of fraud.
When EDD suspects a person of unemployment insurance fraud, they act fast to investigate and file charges in court. Due to insufficient evidence, most of these cases do not go up to the conviction stage.
If you face fraud charges and the prosecutor does not have sufficient evidence to obtain a conviction, your attorney can use this defense to have the court drop your charges. You can only be found guilty if the prosecutor can prove all elements of the offense beyond a reasonable doubt.
Mistaken Identity or False Accusations
Your attorney can cause the court to dismiss your charges if they demonstrate your innocence in court. It is not unusual for a person to be falsely accused or identified as a perpetrator of a crime they know nothing about. Maybe your colleague set you up when they were caught in the process of filing a fraudulent claim with the EDD. Or, someone used your identifying information to apply for unemployment benefits without your knowledge.
A skilled defense attorney will investigate the matter to uncover critical information that they can use to have your charges dismissed.
You Can Enter a Plea Bargain With The Prosecutor
If the prosecutor has compelling proof against you, you will likely face a conviction and all its consequences. Your only choice would be for your attorney to agree to a plea bargain with the prosecutor. That will come with a more favorable outcome than you would receive if convicted of fraud. Plea bargains help both the prosecution and defense.
The prosecutor can suggest a plea bargain if they are not sure of the case's outcome. Prosecutors work hard to ensure that their claims result in a conviction. If the prosecutor feels that their evidence might not result in a sentence, they can suggest a plea bargain. You will enter a plea of guilty or no contest to have your charges reduced in a plea bargain. A conviction for a reduced charge will carry less severe penalties.
Consequences of Conviction for UI Fraud
Unemployment insurance fraud is a wobbler offense, just like other fraud-related offenses in California. It means that the district attorney can charge it as a felony or misdemeanor based on the details of your situation and criminal history. Penalties for those convicted under this statute range significantly and could include time in jail or prison, payment of court fines, and payment of restitution. The main statutes for which you could be penalized for defrauding or attempting to defraud the unemployment insurance program are:
- California PC 550 — It is a more severe form of this crime and regulates general issues related to insurance fraud in California.
- California UIC 2101— It is the most common statute regulating unemployment insurance fraud in California.
The penalties you receive for unemployment insurance benefits fraud will depend on the exact statute you have violated, considering that California has various laws regulating unemployment insurance fraud.
If you face misdemeanor charges under UIC 2101, you could receive a maximum of one year in jail and a fine of $20,000. But if you face felony charges under the same law, you will likely receive sixteen months, two (2) or three (3) years in prison, and a fine of $20,000.
If you face charges under California PC 550, the sum of the money involved in your case will determine your sentence. A misdemeanor charge will suffice if the money is $950 or lower. That would result in a jail sentence of six months and a fine of $1000.
If the money goes beyond $950, the offense becomes a wobbler. If you face misdemeanor charges for unemployment insurance benefits fraud and the amount involved is more significant than $950, you could receive a jail time of one year and a fine of up to $10,000.
Felony charges under California PC 550 are more severe and will attract more severe penalties upon conviction. Felony charges happen if the money involved in your case exceeds $950 or you defraud the program of an amount exceeding $950 consecutively within twelve months. A felony conviction under this statute is punishable by two (2), three (3), or five (5) years in jail, a fine of up to $50,000, or twice the amount of fraud, whichever is more.
A sentence for unemployment insurance benefits fraud also attracts additional penalties, which you must be aware of.
For instance, it could result in professional discipline if you are a professional license holder. A conviction could affect your professional license, resulting in suspension or revocation. Remember that fraud-related offenses are considered crimes of moral turpitude in California. Once your professional license is suspended or revoked, you will not be able to practice your profession until your license-issuing agency reinstates it.
A sentence for unemployment insurance benefits fraud could also affect your eligibility to retain or receive other paid benefits.
You will also be required to repay the benefits received fraudulently with a 30% fine.
Working with a skilled criminal attorney could help you avoid some of these additional consequences of a conviction. For instance, your attorney can request the department to allow you to pay restitution while facing criminal charges. However, that will depend on the circumstances of your case. If EDD agrees to this request and you can make payments on time, you won't face charges in a criminal court. But if you fail to make any payments, EDD could start criminal proceedings against you.
California Unemployment Insurance Benefits and Related Offenses
California unemployment insurance fraud always involves forgery, theft, and perjury allegations. Thus, prosecutors could file other charges on top of or in place of UI fraud. Some related charges are:
California Grand Theft — PC 487
You could face grand theft charges if evidence shows that you took another person's property valued at more than $950. Property, in this case, could include money, land, or personal property. If you obtained unemployment benefits totaling to more than $950, you could also face grand theft charges. Punishment for grand theft includes a maximum jail time of three years and a fine of $10,000.
California Forgery — PC 470
Forgery occurs when you knowingly alter, create or use a written document to commit fraud. You could face forgery charges in addition to UI fraud if you obtained unemployment insurance benefits by using another person's identifying information or signing where your boss or supervisor is required to sign to approve your application.
Forgery is a wobbler offense in California. It is punishable by a maximum of three years of jail time and a fine of $10,000.
California Perjury — PC 118
Perjury occurs when deliberately providing false information under oath. It is a serious offense punishable by four years in jail and a fine of up to $10,000.
If you apply for unemployment benefits with falsified identifying information, the prosecutor could also prosecute you for perjury.
California Conspiracy — PC 182
It is unlawful to conspire with someone else to commit a crime in California. Conspiracy involves agreeing with someone else to commit a crime. Maybe you decided to defraud the unemployment benefits program or to deny insurance benefits to a deserving person. In that case, you will face two charges and receive two consecutive sentences.
Find a Competent Criminal Defense Attorney Near Me
Do you or someone you know face unemployment insurance fraud charges in Riverside, CA?
We understand how serious those charges are at Riverside Criminal Defense Attorney Law Firm. They could result in a lengthy prison/jail time. We handle cases like these every day, offering legal assistance and guidance to defendants like you. Thus, we know the best strategies to produce a fair outcome for your situation. We will guide you through the legal process and fight alongside you to compel the court to reduce or dismiss your charges. Call us at 951-946-6366 to understand your legal options. Our team will study the details of your case for quality legal assistance