California Female Worker Pleads Guilty to Defrauding State in Disability Claims
November 11, 2009
In this week's California employment and labor news, a former employee of the California Employment Development Department (EDD), Audrey Renee Bell, pleaded guilty of mail fraud by certifying false disability claims for friends and defrauding the state--an amount that totaled more than $110,000.
According to United States Attorney Benjamin B. Wagner, Bell entered the guilty plea on Monday after a trial that lasted two weeks. The guilty plea was entered before a Sacramento federal court judge--to ten counts of mail fraud violation.
Bell, 49, was employed as a disability insurance program representative (DIPR) in the Van Nuys, California office of the EDD. As a California state agency, the EDD pays disability insurance benefits to disabled California workers. Bell was in charge of reviewing and authorizing payments on disability claims.
The Fresno Bee reported that from mid-2003 until 2006, Bell approved false disability claims in Los Angeles County to friends, and entered false information into the EDD computer system-- defrauding the EDD of more than $110,000.
According to the state investigation, phone calls made to the EDD fraud hotline reported that an EDD employment agent had unlawfully given disability insurance benefits to friends who had full time jobs. These calls were traced back to Bell.
Bell allegedly authorized payments to her friends by making fraudulent entries in the EDD computer system that indicated that she had received the necessary paperwork, like doctor's certifications, to qualify the claims. When Bell's friends received the checks, they were instructed to cash the checks and meet her in private locations where Bell took a percentage of the cash. A number of Bell's friends testified against her at the trial, claiming that she regularly took half of the proceeds. Bell also used a chiropractor to certify friends as disabled--who also got a cut of the money.
Bell is scheduled to be sentenced in January of next year. The maximum statutory penalty for mail fraud violation is twenty years in federal prison and a fine of up to $250,000, although the judge will determine the actual penalty after taking the federal sentencing guidelines into consideration.
The California Employment Development Department (EDD) offers a wide variety of job services to millions of Californians, including Unemployment Insurance (UI), Workforce Investment, State Disability Insurance (SDI), and Labor Market Information programs. EDD acts as California's largest tax collection agency, and handles the audit and collection of payroll taxes--maintaining employment records for more than 17 million California workers.
Woman Pleads Guilty in Disability Payment Racket, Fresno Bee, November 10, 2009
Former EDD Agent Guilty of Scheme to Provide Fraudulent Disability Payments, Workers Compensation.com, November 10, 2009
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