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Officials react to series of unemployment fraud schemes at Butte County Jail

Investigators are cracking down on a series of unemployment fraud schemes within the Butte County Jail. Action News Now spoke with the District Attorney and Sheriff Kory Honea about the impacts.

Posted: Jun 3, 2021 5:37 PM

BUTTE COUNTY, Calif. - The impacts of a state-wide unemployment fraud scheme are being felt here at home.

Twelve inmates from the Butte County Jail and three people who helped from the outside are facing charges for unemployment fraud.

District Attorney Mike Ramsey said they are looking into other potential cases.

“We started seeing inmate's accounts at the jail getting fatter and money flowing in, investigators looked at what was going on and started talking to people and started unrolling the layers of this fraudulent onion. One case led to two that led to eight, that led to 30, so it was quite the job,” said Ramsey.

Investigators said the inmates in question were applying for unemployment benefits. With help from outside accomplices, they scammed a total of around $370,000.

RELATED: Butte County inmates, helpers face COVID-19 unemployment fraud charges

Sheriff Kory Honea’s said they've dealt with fraudulent activity within the jail before but never anything to this magnitude.

“Certainly there have been fraudulent transactions in the past we have caught but nothing to this scale and I think that speaks to the unprecedented nature of the COVID-19 pandemic and response by the government unfortunately there wasn't a system of checks and balances in place at the state level to prevent people who were incarcerated from receiving these funds it’s too bad but with the good investigative work I think we can bring these people to justice,” said Honea.

Investigators said some used their own names to apply for benefits, others used other people's ID's. Now, deputies are urging people to monitor their bank account information and report any unusual mail from EDD.

Investigators said many of the inmates who are facing charges for unemployment fraud were communicating with each other inside the jail.

D.A. Mike Ramsey said this was able to happen because the EDD system in California did not have a cross-referencing system to verify if those who were applying were in jail or not.

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