California appoints former federal prosecutor as special advisor on unemployment fraud

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SACRAMENTO – The administration of California Gov. Gavin Newsom on Tuesday called on a former federal prosecutor to help investigate billions of dollars in fraudulent unemployment benefits paid by the state.

The Department of Employment Development and the Governor’s Office of Emergency Services Fraud Task Force have appointed McGregor W. Scott as “Special Fraud Advisor.” The agencies said Scott would work with law enforcement to tackle fraud and prosecute those accused of deceiving the government.

Scott was the United States Attorney for the Eastern District of California under former Republican Presidents George W. Bush and Donald Trump. The district covers 34 counties from the Oregon border to Bakersfield in the Central Valley.

While US attorney Scott and several county prosecutors revealed that the state had approved hundreds of millions of dollars in unemployment benefits on behalf of inmates, some of whom were convicted of death row murder.

“Last year the state’s unemployment systems were attacked by sophisticated international and domestic organized fraud schemes,” Scott said. “We look forward to working with EDD, Cal OES, and local, state and federal prosecutors to identify, investigate, and prosecute those who have stolen benefits that rightly belong to Californians in need.”

California was overwhelmed with jobless claims during the coronavirus pandemic after Newsom issued the first statewide stay-at-home order that forced many businesses to close. More than 23 million claims have been filed since March 2020, with the state paying $ 158 billion in benefits.

But at least $ 11 billion of that money was fraudulent, state officials said earlier this year. The state has called an additional $ 20 billion in benefits “suspect,” but has yet to say how fraudulent the benefits are.

The employment development department has put in place protective measures to detect fraud and identity theft, including using a new identity verification tool and cross-checking applications with databases of Thompson Reuters law enforcement, department officials said in a statement.

“McGregor Scott has conducted numerous large-scale criminal investigations during his many years as a state and federal prosecutor – an experience that will help put criminals who defrauded the system behind bars,” said the director. from the Department of Employment Development, Rita Saenz.


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