Santa Barbara County officials investigate allegations of fraud in County Jail
Santa Barbara authorities are currently investigating allegations that at least 157 Santa Barbara County jail inmates have stolen $1.2 million or more in unemployment benefit payments in a large-scale, statewide fraud scheme.
The inmates allegedly filed bogus claims through California’s Employment Development Department, and since the investigation is still ongoing, the amount of inmates and money stolen could be higher.
In a statement to the News-Press, EDD Deputy Director of Public Affairs Loree Levy said: “EDD has been working with the assistance of the U.S. Department of Labor and the Office of Inspector General on cross-matches with inmate populations to identify suspect claims. We’re also pursuing how to integrate such cross-matches moving forward as part of enhanced prevention efforts during this unprecedented time of pandemic-related unemployment fraud across the country. In addition, EDD is working collaboratively with state cyber-security experts.”
Santa Barbara County Assistant District Attorney Brian Cota sat in on a Zoom call Tuesday with more than 100 law enforcement officials across the state to discuss how the fraud was committed.
He told the News-Press on Wednesday that while he can’t speak to how the inmates may have pulled it off, it’s likely they would have needed outside accomplices.
“The process for signing up (for the benefits) is you do it online and answer some questions and provide information, then they send out forms that you have to reaffirm every couple of weeks,” he said. “You can do it online and there’s no one that has to go in person.
“Our supposition right now is that, as far as we understand at least, our local county inmates don’t have access to computers so they would have to have outside help.”
Mr. Cota said that the EDD works with Bank of America, so each individual that is approved for unemployment receives a Bank of America card in the mail.
“At some point, there’s somebody taking that card and authorizing and using it,” he said.
Officials estimated about $150 million stolen in the state prison system and an additional $100 million from the federal prisons in the state. This doesn’t include the county jails, either.
“If you’re looking at our County Jail, and we’re saying $1.2 million, and it’s a small jail. If you assume that that’s going on in every county jail, the numbers can get up there pretty quickly,” Mr. Cota said. “I’m sure that there’s fraud going on just with people outside of prison, stealing people’s identities and applying and receiving.
“I don’t think it’s an exaggeration to say it’s probably one of the largest taxpayer frauds in California history.”
Authorities haven’t investigated the crimes the inmates are in for, but because of the recent releases for nonviolent criminals, the majority of the inmates in the County Jail are excluded from $0 bail, meaning they committed generally serious, violent-type felonies.
In Tuesday’s press conference, officials said 37 states have a process to cross reference the names of people receiving benefits with inmates behind bars in hopes of preventing situations like this. California does not have that cross-referencing process, according to Mr. Cota.
The scheme is comparable to one that occurred at the San Mateo County Jail over the summer, where media reports said 21 inmates received more than $250,000 in payments from the EDD.
According to state law, a person cannot start receiving unemployment benefits while they are in custody, but if they were receiving benefits prior to their arrest, they are allowed to continue receiving them.
No charges have been filed yet, and the District Attorney’s Office is waiting on investigation from the EDD.
“For at least six to eight weeks, we’ve been working on this and trying to get the evidence we need,” Santa Barbara County District Attorney Joyce Dudley told the News-Press. “When I first heard about it, I was shocked and upset because there are a lot of people out there who need those EDD benefits and have a right to those benefits.
“If the allegations are correct, it’s so unfair to those who need to support their families.”