Unemployment insurance is a program meant to protect individuals financially if they are dismissed from employment without fault. This program offers financial relief to unemployed people seeking new employment opportunities. Unfortunately, some people who do not qualify for these benefits commit unemployment insurance fraud as outlined under California Penal Codes 550 and 2101. Committing unemployment insurance fraud is a criminal offense since you end up accessing benefits you do not deserve. You could face severe penalties for committing the crime, including fines and jail terms. Consult a skilled criminal defense attorney if you or your loved one is accused of unemployment insurance fraud. The California Criminal Lawyer Group will offer you the best legal representation and strive for the best outcome for your case in Santa Ana.

Overview Of Unemployment Insurance

The Employment Development Department (EDD) runs the unemployment insurance program. This program was established in 1935, with employers submitting contributions. The contributions were typically deductions from employees, and they were meant to cushion them if they were dismissed from their jobs, sustaining them until they secured new employment.

Eligibility For Unemployment Insurance Benefits

If you voluntarily leave or quit your job, you will not be eligible for the unemployment insurance program. However, you may be eligible for unemployment insurance even if you leave your job voluntarily or through no fault of your own. Several provisions under the law allow you to access the insurance program benefits when you are fired or quit your job. However, in most cases, to qualify for these insurance benefits, the law requires you to:

  • Have been in employment for the past one and a half years.
  • Ready to begin working after you secure a job
  • Physically fit to start working
  • Actively seeking a new job
  • Unemployed

You will receive benefits ranging from $50 to $450 per week if you qualify for unemployment insurance benefits. You will be entitled to the benefits for a period that does not exceed one year. Often, EDD determines the qualification for insurance benefits based on the facts of your case.

Although unemployment insurance aims to protect unemployed individuals, some usually claim these benefits even when they do not qualify. When many individuals misuse the unemployment insurance program, it leads to a backlog in the system for those who lawfully qualify to obtain these benefits. It also escalates the cost of tax deductions for employers.

Circumstances Leading To Unemployment Insurance Fraud

The prosecutor will charge you with unemployment insurance fraud if you do the following:

  • Willfully fake identification documents conceal or present false information to receive unemployment insurance benefits.
  • Help someone else obtain unemployment benefits — You could provide false information, fake identification, and conceal or alter crucial facts.
  • Obtain the insurance benefits when you do not qualify.
  • Intentionally conceal some facts or provide false information to increase unemployment insurance benefits.

Common Examples Of Unemployment Insurance Fraud

You can commit unemployment insurance fraud in many ways. Typical examples include:

  • Giving misleading information on the reason why you lost your job. For example, you could claim you were laid off rather than fired because of poor job performance.
  • Giving misleading information like false name or social security number while working and receiving unemployment benefits simultaneously
  • Creating a fictitious employer and listing yourself among those who qualify for unemployment insurance benefits.
  • While applying for unemployment benefits, you claim to be actively searching for a job when it is not the case.
  • Cashing out someone else’s unemployment insurance benefits without their consent.
  • Attempting to obtain unemployment insurance benefits from a different state while staying in California.
  • Providing false identification documents to obtain unemployment insurance benefits.
  • Failing to notify EDD that you are receiving workers' pensions or compensation.
  • Receiving unemployment insurance benefits while working and failing to notify the EDD of your work.

An employer could be convicted of unemployment insurance fraud if he/she provides misleading information to the EDD about an employee’s salary and termination to avoid contributing to the unemployment compensation program. You could also be convicted of unemployment insurance fraud if you do not submit your employees' deductions to the EDD as the law requires.

The Process Of Investigating Unemployment Insurance Fraud

The EDD often carries out investigations into all unemployment insurance fraud lawsuits. The EDD could commence investigations once they receive the tips from the following sources:

  • If they find red flags on your unemployment insurance benefits application form. The red flags could be a departmental seal or a forged signature
  • Their hotline or website
  • From the members of the public

The EDD officers could investigate your claims if they discover that you provided misleading information, like falsifying your employer information. They could reach out to your employer to verify the information you provided. The EDD could also conduct investigations to determine whether you are actively looking for a new job. They could do so by contacting your potential employers listed on your application forms and verifying if you have applied for a job.

The EDD will also investigate to uncover the truth if you falsify someone else's identification documents. The investigators will use all methods, including surveillance cameras and videos, to show you are guilty of unemployment insurance fraud. The EDD investigators will examine and review the evidence if there is a reasonable belief that you have committed unemployment insurance fraud.

The EDD investigators will make a report and file their findings with the district attorney if they uncover evidence that you committed a crime. The district attorney will then file an unemployment insurance fraud lawsuit against you. However, the investigators could retain their case if they believe the prosecution will reject their findings. Therefore, they will hold on until they gather substantial evidence to use against you in court.

Penalties For Unemployment Insurance Fraud Charges

The court will impose penalties on you based on the facts of your case. Depending on how the prosecutor files the lawsuit against you, you will face charges. For example, the prosecutor could charge unemployment insurance fraud as a wobbler based on the facts of your case and your criminal history. In this case, you could face misdemeanor or felony charges.

You could face unemployment insurance fraud charges under two statutes. These statutes include:

General Insurance Fraud — Penal Code 550

If the prosecutor accuses you of violating Penal Code 550, he/she will file criminal charges against you. In this case, the fraudulent amount will be a significant factor in determining the charges you should face. You will face misdemeanor charges if the prosecutor files charges against you for an amount that does not exceed $950. The potential penalties you could face include the following:

  • Informal or misdemeanor probation
  • A jail term that does not exceed six months in a county jail
  • A fine that does not exceed $1000

The prosecutor will charge your crime as a wobbler if the amount in question is or exceeds $950. You could therefore face misdemeanor or felony charges. Misdemeanor charges will attract the following penalties:

  • Informal or misdemeanor probation
  • A fine that does not exceed $10,000
  • A jail term that does not exceed one year in a county jail

Felony charges for an amount exceeding $950 will attract the following penalties:

  • A fine that does not exceed $50,000 or double the benefits obtained through fraud, whichever is higher.
  • Formal or felony probation
  • A jail term of two to five years in a state prison

Unemployment Insurance Code 1201

According to this statute, using a fake identity, altering, creating a false statement, or concealing facts to obtain unemployment insurance benefits is a crime. However, most prosecutors often prosecute this crime as a wobbler. You could therefore face misdemeanor or felony charges. For example, if the prosecutor charges you with misdemeanor charges, you could face the following penalties:

  • A jail term that does not exceed one year in a county jail
  • A fine that does not exceed $20,000

If the prosecutor charges you with felony charges, you could face the following penalties:

  • A fine that does not exceed $20,000
  • Formal or felony probation
  • A jail term of sixteen months to three years in a state prison

Additional Punishment

You could face additional sentencing if you are convicted of unemployment insurance fraud. In addition, this conviction could negatively influence your profession. At times, the law could revoke or suspend your professional license. This typically happens because unemployment insurance fraud is considered a crime of moral turpitude. All fraud-associated offenses fall under moral turpitude offenses.

If the court charges you with unemployment insurance fraud, it will order you to pay the EDD the money you obtained fraudulently and simultaneously pay a 30% penalty. In addition, you will also be disqualified from receiving and retaining any benefits.

If you face unemployment insurance fraud, you should seek the services of an experienced criminal defense attorney to assist you. Your attorney will advise you on how to return the EDD and negotiate with them so that criminal charges are not filed against you. If the EDD accepts your restitution request, you must pay on time. However, the EDD could still file criminal charges against you if you default.

Defenses Against Unemployment Insurance Fraud Charges

Unemployment insurance fraud is a severe crime that could influence your life negatively. Therefore, you must create a proper defense strategy that is tailor-made to suit your charges to ensure the best results. Several defenses are available, which your attorney could use to challenge your charges. Some of the defenses you or your attorney could raise include the following:

Plea Bargaining

The circumstances surrounding your unemployment insurance fraud lawsuit will lead to your sentencing. You could discover that you have no legal defense strategy at times. Your attorney could discuss a plea bargain with the prosecutor. A plea bargain will help minimize your criminal liability in the lawsuit. A plea bargain could also assist you in obtaining a favorable judgment if the prosecutor has weak evidence against you. This often happens if several unemployment insurance fraud lawsuits are pending in court, and the prosecutor wants to clear the backlog.

A plea bargain will ensure that the prosecutor agrees to dismiss or reduce all charges. However, the prosecutor will only agree to do so if you agree to a ''no contest'' or ''guilty'' charge.

False Accusation Or Mistaken Identity

At times, you could be accused of insurance fraud when your colleague in the office frames you for the offense. For example, this could happen if your colleague files a fraudulent insurance claim and accuses you upon discovering that he/she is about to be busted.

On the other hand, you could be a victim of identity theft, whereby another person uses your identity while committing unemployment insurance fraud. Using the mistaken identity defense, you can prove your innocence before the judge. In this situation, you must provide substantial evidence to show that you did not submit the falsified documents.

Insufficient Evidence

Unemployment insurance fraud has been on the rise in recent years. As a result, investigations into fraud crimes have also intensified to tame these crimes. Unfortunately, this puts pressure on investigating agencies, who rush to file charges against individuals without gathering sufficient evidence.

Without substantial evidence, investigators may easily conclude that you should be arrested and sued for unemployment insurance fraud. You could face charges under these circumstances, whereby the prosecutor accuses you of intentionally participating in fraudulent activities against the EDD. Therefore, you must consult a criminal defense attorney if you find yourself in this situation.

Your defense attorney must prove that there is insufficient evidence for you to face unemployment insurance fraud charges. For example, if you run an oil refinery company, the court could charge you for intentionally withholding employee deductions and failing to submit them to EDD. Your attorney can defend you by proving you do not handle the company’s accounts. Your attorney can also prove that you do not handle your employees' payroll, and there is no way you could intentionally fail to submit the deductions to EDD. The judge could drop the charges against you based on insufficient evidence.

You Had No Fraudulent Intent

You can only face unemployment insurance fraud charges if the prosecutor proves you knowingly acted fraudulently. The court could acquit you of these charges if the prosecutor fails to prove that you knowingly acted with the intent to defraud the EDD.

Your attorney could claim that you reasonably believed the documents you submitted during the insurance benefits application were legitimate. Your attorney could also allege that you submitted false information accidentally to the EDD and did not intend to defraud the department. For example, you could write the wrong social security number or name on the application form.

Sometimes, you can unknowingly fail to share certain information with the EDD. For example, you can fail to inform the EDD about your Sacco dividends because you did not know you were required to share this information. The law, therefore, should not hold you accountable for violating the unemployment fraud laws.

Related Offenses

Often, unemployment insurance fraud involves theft allegations, forgery, and perjury. The prosecutor could therefore charge you with other related crimes to go along with unemployment insurance fraud. The related offenses include the following:

Perjury – Penal Code 118

According to Penal Code 118, perjury is a felony crime. The prosecutor could convict you of this crime if you give misleading information under oath when you swear to say nothing but the truth. The prosecutor could also convict you of perjury if you intentionally and willfully sign a document with misleading information. If the prosecutor accuses you of perjury, this statute requires that he/she prove the following elements:

  • You took an oath to testify truthfully under the perjury penalty
  • You willfully stated that information was true even though you were aware it was false
  • The information was material
  • You were aware that you were making a statement while under oath
  • You intended to testify falsely when you made your false statement

If the prosecutor charges you with this offense, you could face the following penalties:

  • A fine that does not exceed $10,000
  • Participate in community service
  • Probation
  • A jail term that does not exceed four years

Conspiracy — Penal Code 182

According to Penal Code 182, it is a crime to commit a conspiracy offense. Prosecutors often charge this crime as a felony. The prosecutor could convict you of this crime if you agreed with someone else to commit a crime. Examples of conspiracy crimes include:

  • Blocking or denying a legitimate person to obtain unemployment insurance benefits
  • Accepting falsified documents to obtain unemployment insurance benefits

You will face penalties for this crime based on the nature of your charges. For example, if the prosecutor charges you with conspiracy to commit unemployment insurance fraud, you could face the following penalties:

  • A fine that does not exceed $10,000
  • A jail term that does not exceed one year in a county jail

If the prosecutor charges you with conspiracy to commit identity theft, you could face the following penalties:

  • A jail term that does not exceed five years in a state prison
  • Formal or felony probation
  • A fine that does not exceed $25,000

You could face conspiracy charges even if you did not commit the offense you were conspiring to commit.

Forgery — Penal Code 470

It is an offense under Penal Code 470 for any person to intentionally alter, create, or use a written document to commit fraud. The prosecutor could charge you with forgery if you face charges of unemployment insurance fraud because you altered your identification documents by creating a fictitious employer or assuming someone else’s identity.

Courts often charge this crime as a wobbler. You could therefore face misdemeanor or felony charges. If the prosecutor charges you with a misdemeanor, you could face the following penalties:

  • A fine that does not exceed $1000
  • A jail term that does not exceed one year in a county jail
  • Informal or misdemeanor probation

If the prosecutor charges you with a felony, you could face the following penalties:

  • A jail term that does not exceed three years in a state prison
  • A fine that does not exceed $10,000
  • Formal or felony probation

Possession Of Counterfeit Seal — Penal Code 472

According to Penal Code 472, it is an offense for any person to possess, counterfeit, or forge a public seal. If you are accused of violating Penal Code 472, the prosecutor must prove the following elements:

  • You counterfeited, forged the state seal
  • When you did so, you intended to defraud

Most times, prosecutors charge this crime as a wobbler. The potential penalties you could face include the following:

  • A fine that does not exceed $10,000
  • A jail term that does not exceed three years in a state prison

You could contest these charges with the following defenses:

  • Violation of your constitutional rights
  • It was a police officer entrapment.
  • You had no intention to defraud

Grand Theft — Penal Code 487

It is illegal under Penal Code 487 to unlawfully take someone else’s property valued at over $950. Under this statute, the property includes labor, money, and private land. The prosecutor could charge you with grand theft if you fraudulently received unemployment insurance benefits exceeding $950. Grand theft could attract the following penalties:

  • A fine that does not exceed $10,000
  • A jail term that does not exceed three years in a state prison

You can contest these charges by raising the following defenses:

  • False accusation
  • The owner consented to you taking the property.
  • You obtained the property under the ''claim of right.’’
  • You did not have the intent to steal

Find A Santa Ana Criminal Defense Attorney Near Me

Consult a skilled Santa Ana defense attorney if you are accused of unemployment insurance fraud. At the California Criminal Lawyer Group, our experienced legal team reviews your charges and advises you accordingly. We will also create a defense strategy to persuade the court to reduce or dismiss your charges. For legal guidance and representation, do not fail to contact us. Our able team will answer you right away. Call us at 714-844-4151 to speak to one of our attorneys.