Ex-EDD employee gets 5 years in prison for $4.3M COVID relief fraud scheme

A former California Employment Development Department employee from Perris was sentenced Friday to more than five years in prison for causing nearly 200 fraudulent COVID-related unemployment relief claims to be filed in other people’s names, resulting in nearly $4.3 million in ill-gotten gains.

Gabriela Llerenas, a.k.a. “Maria G. Sandoval,” was sentenced to 63 months in federal prison by a judge who also ordered her to pay $4,298,093 in restitution, according to a news release from the U.S. Attorney’s Office in the Central District of California.

Llerenas, 44, took advantage of the expanded eligibility for unemployment insurance benefits made possible by the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed by Congress and signed into law in March 2020. The CARES Act provided additional unemployment insurance benefits to qualified individuals, and helped provide such benefits during the COVID-19 pandemic to people who did not otherwise qualify.

From April to October 2020, Llerenas filed and caused the filing of fraudulent unemployment insurance benefits with the EDD, falsely asserting the named claimants were self-employed independent contractors – often identifying them as cake decorators or event attendants – who were negatively affected by the COVID-19 pandemic, the U.S. Attorney’s Office said.

Llerenas obtained some of the names, Social Security numbers and other identifying information she used to submit the fraudulent claims through her prior work as a tax preparer, the news release states.

She also falsely said on some of the applications that the claimants were residents of California entitled to unemployment insurance benefits administered by EDD, when in fact they lived elsewhere. On some applications, she inflated the amounts of income she reported for the claimant to maximize the benefit amount. She also filed a dozen or more fraudulent EDD claims in a day.

As a result of the fraudulent applications, EDD authorized Bank of America to mail debit cards in the names of the claimants to addresses Llerenas provided, including her residence, her husband’s business location, her mother’s apartment and the addresses of friends and other family members.

Llerenas charged the named claimants a fee for filling the applications, which was often paid out of the fraudulently obtained benefits. In at least one case, she told the named claimant that she was still employed at EDD and could control the distribution of the unemployment insurance benefits, and then demanded an additional payment for “releasing” the benefits, the news release says.

 In total, 197 debit cards were fraudulently issued because of the scheme.

The judge who sentenced Llerenas found that the resulting losses to EDD and the United States Treasury totaled $4,298,093.

As part of the investigation, $621,124 in cash was seized from Llerenas and has been forfeited.

Llerenas previously worked at EDD as a disability insurance program representative. She resigned in March 2002 after admitting to fraudulently authorizing and paying disability benefits administered by EDD. She was sentenced to 37 months in federal prison in connection with that scheme.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the DOJ’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

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