The Reality of Unemployment Fraud

Unemployment fraud isn’t new. There have been instances of it dating all the way back to when the system for helping people stay financially solvent after they suddenly lost a job was first created.

The high number of people who were forced to claim unemployment benefits when the pandemic struck the United States, combined with some unexpected unemployment bonuses the government instituted in an attempt to keep the economy running has triggered an interest in unemployment fraud.

In California, you can be charged with unemployment fraud if it’s believed that you knowingly supplied inaccurate information to obtain unemployment benefits you aren’t entitled to. Even if your application isn’t approved, you can be charged with unemployment fraud.

Examples of unemployment fraud include:

  • Providing false identification information on the application
  • Failing to report earned income while collecting unemployment
  • Failing to report additional forms of compensation you’re collecting while also collecting unemployment
  • Not being a legal California resident
  • Falsifying employment information
  • Stealing another person’s unemployment check

Individuals aren’t the only ones who can be accused of unemployment fraud. Employers can also end up in hot water. If an investigation reveals that employer-supplied false information to the state to make it difficult for an employee to collect the unemployment benefits they deserve, the employer will be charged with unemployment fraud.

Unemployment fraud in California is a wobbler offense. Whether someone is charged with a misdemeanor or a felony depends on the amount of money they collected from the scam. If the amount is less than $950 misdemeanor charges are filed. The penalty can include a $1,000 fine and spend up to six months in county jail.

If the amount is greater than $950 and the prosecutor decides to stick to with a misdemeanor, it’s a potential $10,000 fine and year in a county jail.

In felony unemployment fraud cases the amount must exceed $950. Being found guilty could result in up to a 5-year jail sentence and a $50,000 fine. In addition to the fines, the state demands that the money was stolen from the system be returned and adds a 30% interest rate to the total.

The best way to avoid an unemployment fraud charge is to be completely honest on your unemployment application.