Presentation on theme: "Building Bridges to Success: Attacking Unemployment Insurance Fraud"— Presentation transcript:
1 Building Bridges to Success: Attacking Unemployment Insurance Fraud Tony Dixon, DirectorDivision of Program FraudU.S. Department of LaborOffice of the Inspector GeneralWashington, DC
2 DOL - OIG MissionTo serve the American Worker and Taxpayer by conducting audits, investigations, and evaluations resulting in improvements in the effectiveness, efficiency, and economy of Departmental programs and operations;detect and prevent fraud, waste and abuse in DOL programs (and labor racketeering in the American workplace, the only OIG to do so);provide advice to the Secretary and Congress on how to attain the ultimate in program performance.
3 DOL-OIG Offices Approx. 150 Agents 28 Offices New York CHICAGO RO DetroitSeattleClevelandBuffaloBostonMeridenNew YorkPittsburghNewarkCHICAGO ROAtlantic CitySan FranciscoColumbusPHILADEPHIA ROKansas CityDenver RARoanokeLas VegasWASHINGTON DC ROSt. LouisLOS ANGELES R.OJackson RAATLANTA RODALLAS ROBaton Rouge RAJacksonvilleApprox. 150 Agents28 OfficesHouston RAMiami Sunrise
4 Why A Joint Effort? What is UI? Who does UI Fraud Affect? – Benefits afforded via a multi-billion dollar program dependent on employer and complainant compliance with Federal and State laws.Who does UI Fraud Affect?Minimally, every American citizen.Who is responsible for addressing UI fraud?Arguably, every responsible American adult that has knowledge of fraud.
5 The American Recovery and Reinvestment Act Why so important?Provides assistance to a significant amount of unemployed American citizens experiencing uncommon economic hardshipIntroduces an unprecedented amount of funds into the American societyRepresents a prime opportunity for massive fraud against the governmentDifferent than Hurricane Katrina Relief
6 Possible Fraud Indicators Connections between (false) companies:Common employer addressesCommon claimant addressesCommon claimantsMinimal contributions by employer
11 Common UI Schemes Identity Theft 4. Fictitious Employer 7. Pretexting Data Mining Money Laundering Debit Card FraudPII Fraud Check Counterfeiting 9. UI EvasionCompany representatives obtain personal information under false pretensesInternal employee uses position to obtain UI data base information for purposes of committing UI fraudIllegal obtainment of UI benefits via electronic deductionsDevelopment and or use of fraudulent UI benefitsRecruitment of family and friends to receive UI claim benefits based on false wages
12 Common UI Schemes - cont. Identity Theft 4. Fictitious Employer 7. PretextingData Mining Money Laundering Debit Card FraudPII Fraud Check Counterfeiting UI EvasionBogus companies file UI claims for unsuspecting or nonexistent individualsIllegal use of personal identification informationThe sale of confidential informationMisuse of confidential employment/wage, federal tax and medical informationNegotiation of illegally obtained UI benefits for profit
13 What to do when you find or suspect fraud? Dumpster DivingPre-textingWhat to do when you find or suspect fraud?Report It!!!
14 To Whom Do You Report Fraud? SupervisorState Department of LaborUI District OfficeUI National OfficeOIGOther authorities
15 MOU - OIG and ETA, OWS Signed June 29, 2005 and currently in effect Established procedures for SWAs, OWS, and the OIG to address issues of fraud, vulnerability, and integrity in both State and Federal UI programsRequires each SWA to promptly notify the OIG of known substantive allegations of malfeasance, criminal misconduct, and large scale fraud
16 MOU – What to Report to OIG Known instances or allegations of potentially illegal or fraudulent activity in excess of $5000 concerning UCFE, UCX, TAA, DUA, and extended benefit programs, with the mutual understanding that the dollar threshold may be adjusted on a State-by-State or Regional basis
17 MOU – What to Report to OIG, (cont.) Known instances or allegations of potentially illegal or fraudulent activity in any amount concerningUI administrative fund theftsFictitious/fraudulent employer schemesMultiple state and/international claim or tax schemesSchemes involving multi-claimant or multi-state false federal documentationCounterfeit benefit checks or multi-forgery cases
18 OIG/ETA PartnershipRegularly meet to discuss and brainstorm on best practices to address fraudETA routinely refers information on suspected or known fraud to the OIGOIG implementing process for relaying appropriate investigative results to ETA for its knowledge and considerationParticipation in each others training conferences and seminars
20 New OIG Fraud Efforts Postings of fraud schemes to OIG internet site Fraud alerts to be sent to all OIG Offices and to ETA HQPursuit of ARRA related UI fraud according to thresholds of respective US Attorney District Offices
21 Anti-Fraud Measures Properly Dispose of/Handle Information Shred or burn documentsSecure Trash AreasReduce unnecessary paperArchive records appropriatelyLog off computer when away from work station
22 Anti-Fraud Measures– cont. Implement telephone safeguardsDo not answer excessive telephone questions from suspicious sourcesFlip the script and question the callerCarefully document any information provided by callerVerify and cross reference information with others alleged to have provided informationNotify supervisor of suspicious activity and refer to UI District Office, UI National Office and OIG
23 Who Is Committing the Fraud? Legitimate and Bogus Employers/BusinessesAverage American CitizensInternal EmployeesLoose-knit organized crime groupsStreet gangsIllegal immigrantsInternational organized crime groupsOthers?
25 BusinessesStoreownerMaria SanchezMore than 23,000 UI checks totaling more than 7 million depositedChecks from CO, KY, NY, MP, NV and WAMultiple Claimant addresses on checks used in four other major UI investigations.
26 Internal Employees Tina “Yayoi” TURLEY California Employment Development Department (EDD)Accounting Technician – UI Benefit
27 Link Analysis Chart Shelley Leigh TEUBNER “Best Friend of Tina Girlfriend of Steve FischerLeuvena Eleanor MESSERUnknown relation to TINAWritten personal checks to TINATerrie Nana TURLEYSister of TinaCashing UI checksStephen Everett FISCHEROwner of PIPE, Inc.Employers claiming Wages Boyfriend of Shelly TAUBNERFrank Ramos MEJIAOwner of Dynamic LimoCashing UI ChecksMichael Lewis TOBLERHarley Jason WACKTeruko Arima – TURLEY“Mother of TinaHas Claims but not openJoseph Michael SIGALA, JRDynamic Limousine7909 Walerga Rd Antelope, Ca Operated by Frankie MEJIA UI Wages CashedPipe, Inc.9427 Elder Creek, Sacto, CAOperated by Stephen FischerUI Wages cashedTina “Yayoi” TURLEYEDD employee – UI BenefitJoseph BILLOTTEBoyfriend of TinaVickey Marie BILLOTTEFormer wife of Joseph andCashing UI ClaimsUS Dept of LaborPC / IS2005-1Sean Ferguson, USDOLInvestigator Leticia Lopez - EDD
28 Florencia 13 Street Gang Gang Member Extensive Counterfeiting of UI Checks
29 International Organized Crime Groups Abdulla Kasem Ahmed MuthanaUndercover operation with the Joint Terrorism Task Force revealed that Muthana, a target in a OIG UI case, had intentions of funneling money derived from his UI fraud to the Hezbollah militia in Lebanon.
30 Potential Violations Title 18 U.S.C: § 371 Conspiracy § 641 Public money, property or records§ 1341 Mail Fraud§ 1343 Wire Fraud§ 1028 Identity Theft
31 DOL-OIG UI Investigative Results 10/01/2005 – 09/30/2009 447 Indictments404 Convictions$107,576,853 in civil, administrative, and criminal restitutionJail sentences as high as 33 months
33 Dan Petrole, Deputy Inspector General Tom Farrell, Assistant Inspector General, InvestigationsRich Clark, Deputy Assistant Inspector General, InvestigationsContact InformationTony Dixon, Director Division of Program Fraud (office) (mobile)Jon Metrey, Deputy DirectorDivision of Special Operations (office) (mobile)Robin Blake, Deputy Director Division of Program Fraud (office) 202. (mobile)Chris Collins, Investigative Research SpecialistDivision of Intelligence(office)
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