Three Indicted in Connection with Allegedly Stealing Over $488,000 in Connection with Orchestrating Several Fraudulent Schemes
Defendants Allegedly Stole Hundreds of Thousands of Dollars in Unemployment Fraud and Larceny Schemes
A special statewide grand jury returned indictments against Elis Reyes, age 26, of Bronx NY, his mother Teresa Cruz Colon, age 51, of Leominster, and co-worker Atia Dobson, age 31, of Fitchburg, charging the following:
Unemployment Fraud (32 counts)
Larceny over $250 (34 counts)
Identity Fraud (6 counts)
Intimidation of a Witness
Teresa Cruz Colon
Unemployment Fraud (13 counts)
Receiving Stolen Property (13 counts)
Larceny over $250
Identity Fraud (6counts)
"We allege that Mr. Reyes and his co-defendants devised multiple schemes to steal hundreds of thousands of dollars from the Commonwealth and businesses at a time when many people are out of work and struggling to make ends meet," AG Coakley said. "These types of crimes not only hurt employers in Massachusetts, but they also put a significant strain on the state by draining resources needed to help individuals that are legitimately unemployed."
In May 2010, the Attorney General's Office began an investigation after the matter had been initially investigated and referred by the Executive Office of Labor and Workforce Development's Department of Unemployment Assistance (EOLWD/DUA). Authorities allege that Reyes orchestrated three distinct unemployment fraud schemes between 2006 and 2010 in which he defrauded the state and also two additional criminal schemes in which he allegedly defrauded private companies.
Initially, Reyes worked for a staffing company that placed temporary workers in various businesses. One of the companies that used the staffing company was a Leominster based manufacturing company that went out of business in 2006. The manufacturing company contacted the EOLWD/DUA in order to prepare the EOLWD/DUA for individuals who would apply for unemployment benefits as a result of the company's closing. Authorities allege that Reyes used his knowledge of the company's situation to steal over $53,000 in unemployment benefits for employees who never worked at the manufacturing company. The checks issued by the EOLWD/DUA were allegedly deposited to bank accounts owned by individuals associated with Reyes, and his mother, Teresa Cruz Colon.
Investigators discovered two more schemes Reyes allegedly orchestrated to steal unemployment benefits. In the first scheme, authorities allege that Reyes created his own staffing company, Abeitus Solutions (Abeitus), which he incorporated in Leominster. Reyes registered Albeitus with the EOLWD/DUA and authorities believe fraudulently obtained unemployment benefits for over a dozen "employees:" employees he claimed were terminated from his company. Based on this false information, the EOLWD/DUA paid over $228,000 in unemployment benefits to individuals who purported to work for Abeitus. Authorities allege that Reyes had these checks sent to addresses associated with himself and his mother, who investigators believe also cashed and deposited these checks.
In March 2009, Reyes incorporated another staffing company, Itane Ventures (Itane). In this instance Itane was a totally fictitious company. Authorities allege that Reyes again filed fraudulent unemployment claims for fake employees who had been laid off from Itane. As a result of these false statements, Reyes improperly received nearly $125,000 in unemployment benefits.
As the investigation progressed, authorities discovered that Reyes had also orchestrated two other schemes in which he stole from his former employers. Investigators uncovered that Reyes and his co-worker, Dobson, stole $77,000 from a temporary staffing agency where both of them had worked. Reyes accomplished this by contacting the staffing company, using a false identity, and falsely requested the placement of temporary employees. The staffing company, believing that these temporary workers were actually working at a company, issued checks to these employees for their services. In reality, none of these alleged "employees" performed any work at all. Authorities allege that Dobson would retrieve these checks from the staffing company and give them to Reyes.
Reyes also perpetrated a second similar scheme while working at another staffing company. Reyes allegedly placed several temporary employees in different companies, one company did not even exist, for work that was never ordered or performed. As a result of this fraudulent scheme, Reyes' employer issued checks for these employees even though they did not exist and no work was performed. Authorities allege that Reyes was stole $5,000 from this employer based on his fraudulent actions.
On October 20, 2010, a special statewide grand jury returned indictments against Reyes, Colon and Dobson. Reyes is currently being held in federal prison on an unrelated matter. A warrant has been issued for Reyes' to appear in Suffolk Superior Court to be arraigned on these charges. Dobson and Colon are expected to be arraigned in Worcester Superior Court on November 17, 2010.
The case is being prosecuted by Assistant Attorneys General Stephen Adams and Jennifer Cotter, both of AG Coakley's Insurance and Unemployment Fraud Division and was investigated by Luke Goldworm and Massachusetts State Police of the Attorney General's Office and Mark St. Onge and Joshua Nussey of the EOLWD/DUA.