NORFOLK, Virginia – Unemployment fraud related to COVID-19 has been widespread across the United States, and cases continue to be heard at the courthouse in Hampton Roads.
Some of the most shocking cases involved people using prison inmates’ personal information to obtain unemployment benefits they were not entitled to.
Four locals were involved in a recent case.
Inmate Dedrion Short was incarcerated at Buckingham Correctional Center in Dillwyn, Virginia, in June 2020 when the plot first came to light.
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While the federal government was distributing COVID relief funds, Short let Meisha Thompson of Virginia Beach, who is not in prison, use his information to receive unemployment benefits, according to federal court documents.
The Virginia Employment Commission (VEC) gave him over $16,000.
While incarcerated, Short collected information from other inmates, such as their social security numbers and dates of birth.
Thompson and two others, Lemyron Hawkins (also known as Chesapeake) and Norman DeLoatch of Norfolk – who court documents say are Short’s half-brothers – then successfully filed unemployment claims for 21 different inmates between June 2020 and November 2020.
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According to court documents, the VEC transferred a total of over $327,000 to them.
The Department of Justice has investigated thousands of fraud cases related to the COVID-19 pandemic.
The Associated Press conducted an analysis and found that criminals embezzled over $280 billion in COVID-19 funds and another $123 billion was wasted or misappropriated.
According to experts, the funds were spent too quickly and not enough control mechanisms were put in place.
In the Buckingham inmates’ case, all four pleaded guilty to conspiracy to commit mail fraud.
Records show that when the VEC realized what was going on, they were able to recover some of the funds. However, they still lost over $309,000.
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Legal analyst Sonny Stallings of the Stallings Law Group says this level of fraud is worrying.
“I know we want a crisis and we want to give people money so they can live, but … the people who run these programs should know, everyone in the world knows, that there are scammers out there and you’re making it too easy for scammers to get government money,” Stallings said. “There should have been some kind of checks and balances before they started distributing this money. I don’t care how desperate we were.”
Sentencing for all four suspects in this case is expected to take place in December of this year in federal court in Norfolk.
The Virginia Employment Commission released the following statement in response to a News 3 inquiry:
The Virginia Employment Commission (VEC) understands the importance of transparency and accountability, especially when it comes to safeguarding public funds. During the pandemic, the VEC paid out over $14 billion in benefits. Although the vast majority of the funds went to legitimate unemployed Virginia workers in need, many cases are still being collected and investigated. Since April 2020, the VEC has reported $85.9 million in fraud cases to the U.S. Department of Labor.
Like all state unemployment insurance agencies, the VEC has faced unprecedented levels of identity theft during the pandemic, largely perpetrated by sophisticated criminal organizations, including those based overseas. Despite these challenges, we have been able to identify some perpetrators and are actively working with our state and federal partners, such as the Virginia Attorney General’s Office and the U.S. Department of Labor’s Office of the Inspector General, to bring them to justice.
As for your question about the total amount paid out to Virginia inmates, the VEC does not track overpayments in this manner. However, you may have seen that the VEC has worked with federal prosecutors in several cases (justice.gov) to hold these fraudsters accountable.
In response to the high volume of applications and the economic impact of the pandemic, we have implemented and continue to implement robust technology, process improvements, and enhanced internal controls to protect public funds. For security reasons, we cannot go into detail, but we are using sophisticated techniques to detect and stop fraud much earlier in the process. This includes expanded use of ID.me (vec.virginia.gov), a digital identity verification tool that adds an additional layer of security and makes it easier for eligible applicants to receive benefits while blocking fraudsters from accessing our system. In addition, we have enhanced our call center technology to better detect and prevent fraudulent activity in real time.
Employers can play a critical role in preventing VEC fraud by responding to layoff reports in a timely and accurate manner. Layoff information is critical to determining whether claimants are eligible for benefits. Benefits are paid through state and federal unemployment taxes collected from employers, and their responses help ensure that only eligible individuals receive benefits, thereby preventing fraud. Employers can learn more about their responsibilities in the layoff process on our website.
If a customer suspects fraud or identity theft related to unemployment insurance benefits, they are urged to report it by completing the VEC Fraud/Theft/Overpayment Form (vec.virginia.gov) on our website.
VEC is committed to maintaining the integrity of the unemployment insurance system and will continue to take all necessary steps to prevent fraud. Our team takes this issue very seriously and will continue to pursue those who attempt to defraud our system to ensure resources are protected for Virginians who temporarily need this important assistance.
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