Investigators uncover scheme in which inmates received COVID-19 unemployment money

PITTSBURGH — Inmates at multiple federal and state prisons in Pennsylvania illegally received COVID-19 unemployment payments, according to investigators.

The inmates and their accomplices are accused of filing false and fraudulent statements in order to obtain Pandemic Unemployment Assistance benefits.

According to U.S. Attorney Scott Brady, he was prepared to see fraud on an unprecedented scale once President Trump announced the federal help for unemployment benefits. Brady, working with Attorney General Josh Shapiro, said they created a task force right away involving federal, state and local officials.

Brady said 33 people were charged in eight state and federal prisons with fraud related to unemployment benefits. He said people on the outside were helping with the scheme, including girlfriends, friends and family members. Prison and postal officials helped uncover the plan after noticing large amounts of unemployment mail going to abandoned houses.

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Over 10,000 inmates in state facilities have been found trying to apply for unemployment benefits across the state. Each of the inmates received at least $10,000. Brady said over $100 million in fraud related to the unemployment programs has been discovered. Once local prisons were added in, Brady estimated nearly $200 million in fraud was found. Officials said they have all the names of all of the inmates who have submitted applications.

“When there’s money on the line, scammers start working overtime,” Shapiro said.

Shapiro said the pandemic has been difficult for everyone and has exposed deep disparities in our communities. He said sophisticated scammers started working to take advantage of the situation during the crisis. Shapiro said his office has found fake unemployment websites, people hacking Zoom meetings and others using the unemployment crisis as a chance to rip off hard working people.

Shapiro said jail phones were used by inmates to coordinate with people outside with how to apply for the benefits and where to send the money. Additionally, five people were arrested in connection with an identity theft scam in order to file unemployment claims. Two of those people are believed to have filled out over 20 different applications.

“We will continue to root out scammers,” Shapiro said.

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