Four Las Vegas, Nevada defendants were sentenced up to 37 months in federal prison for running a multi-million state and federal unemployment compensation scam. Francisco Garcia, the leader of the unemployment compensation scam, received 37 months, Efrain Garcia and Nabora Garcia received 24 months, and Eloy Garcia received 15 months.
Under the unemployment compensation scam, the four defendants had illegal immigrants, who were aware non-U.S. citizens were not entitled to unemployment benefits, use fake Social Security numbers to submit almost 600 fraudulent unemployment compensation claims. The claims were filed by phone or online which doesn’t require proof of citizenship. The defendants then had the State of Nevada mail out the unemployment benefits to the defendants, not the illegal immigrants. Over an almost two year period, the defendants collected $4.4 million in state and federal unemployment compensation benefits.
The investigation of the unemployment benefits scam was a joint operation among several agencies – the Employment Security Division, the IRS Criminal Investigation, and the U.S. Department of Labor’s Inspector General. According to the Las Vegas special agent in charge at the IRS, it was “greed and a money paper trail” that ultimately led to the defendants undoing. “With Nevada’s unemployment rate a record highs, the scam not only taxed the system economically, it also “disrupted the entire unemployment benefits program,” said Steve Zuelke, who runs the fraud unit for the Nevada Employment Security Division. “And considering that the defendants obtained over $4 million illegally in amounts less than $1 thousand, the extent of this fraud was staggering,” said Nevada U.S. Attorney Daniel Bogden.
According to the Department of Labor, 11% or $20 billion unemployment compensation payments are improper. Since the scam was revealed, Nevada is checking all unemployment benefits claimant applications against the Social Security Administration.
All four defendants, who were found guilty of money laundering, mail fraud, and/or false representation of a Social Security number, are required to make restitution.
The Las Vegas law office of Lagomarsino Law did not represent anyone involved in the above-referenced case. The commentary is for educational and commentary purposes only. If you would like to be represented by a Nevada attorney, contact our office for a free confidential case review and receive a response within hours. Call Toll Free 866-414-0400.