Prison Inmate Pleads Guilty, Sentenced for Stealing Nearly $50,000 in Unemployment Benefits While Incarcerated
Multiple Defendants Assisted in Scheme to Fraudulently Collect Benefits During Incarceration
BOSTON – A prison inmate has pleaded guilty and has been sentenced to seven years in state prison in connection with a scheme to fraudulently collect nearly $50,000 in unemployment benefits during his incarceration, Attorney General Martha Coakley announced today. This case is the result of an investigation referred to the Attorney General’s Office by the Executive Office of Labor and Workforce Development’s Department of Unemployment Assistance (EOLWD\DUA).
“This defendant conspired to fraudulently collect unemployment benefits during his incarceration,” AG Coakley said. “These allegations are a disturbing example of the lengths people will go to defraud the system.”
“The successful prosecution of these charges is the result of continued collaboration between the Department of Unemployment Assistance and the Attorney General,” said Secretary of Labor and Workforce Development Joanne F. Goldstein. “We will continue to identify, investigate, and prosecute suspected fraud to protect legitimate claimants, employers, and the integrity of our system.”
Daniel Mullaney, 42, of Everett, pleaded guilty to charges of Unemployment Fraud (71 counts), Larceny Over $250 by False Pretenses (2 counts), Conspiracy to Commit Unemployment Fraud (2 counts), Conspiracy to Commit Larceny (2 counts), and Habitual Offender. Following his plea Superior Court Judge Mitchell H. Kaplan sentenced Mullaney to seven years to seven years and one day in state prison.
Mullaney, along with co-defendants Derek McCarthy and Stacey Carlin, conspired to steal thousands of dollars in unemployment benefits on his behalf during his incarceration between March 2010 and August 2011. The scheme was initially detected and investigated by the Department of Correction and referred to EOLWD\DUA.
Mullaney applied for and began receiving unemployment benefits from EOLWD\DUA in October 2009, after being separated from his employer and arranged for deposits to be made in the bank account of his ex-wife Stacey Carlin.
In March 2010, Mullaney was incarcerated in state prison on separate charges. During this time, Mullaney maintained contact with Carlin through phone calls while in custody, providing instructions as to what to say and how to proceed with his unemployment claim. Carlin falsely certified Mullaney’s unemployment claims for six weeks from March 2010 through April 2010, notifying EOLWD\DUA that he was not working, that he was able to work and was available for work.
Derek McCarthy, a friend and former fellow inmate of Mullaney, also assisted in the scheme. Following his release from custody in June 2010, McCarthy opened a bank account over the Internet for the purposes of fraudulently depositing Mullaney’s unemployment benefits. Mullaney maintained contact with McCarthy through phone calls while in custody to discuss the false certifications and provide answers to the security questions necessary to provide certification via Internet to EOLWD\DUA. McCarthy falsely certified Mullaney’s unemployment claims for 56 weeks from June 2010 through July 2011, notifying EOLWD\DUA that he was not working, that he was able to work and was available for work.
As a result of this scheme, the defendants fraudulently collected unemployment benefits totaling $49,953 during Mullaney’s incarceration.
A Suffolk County Grand Jury returned indictments against Mullaney on Aug. 23, 2012. Mullaney was arraigned on Sept. 5, 2012 in Suffolk Superior Court where he pleaded not guilty and was released on personal recognizance and remained held on his previous sentence. Mullaney pleaded guilty today and was sentenced. Co-defendants Derek McCarthy and Stacey Carlin were sentenced on Dec. 5, 2012.
The Department of Unemployment Assistance (DUA) provides temporary assistance to unemployed workers through the Unemployment Insurance (UI) program, which is funded by employer contributions. Private employers are required to pay quarterly contributions into the trust fund based on the number of workers they employ and how often their workers have accessed UI benefits, among other factors.
DUA’s Program Integrity Department focuses on the prevention, detection and the investigation of those who defraud or attempt to defraud the unemployment insurance program. Once fraud is detected, the Program Integrity Department works aggressively with the Attorney General’s office and other agencies to recover money owed to the UI Trust Fund.
AG Coakley’s Insurance and Unemployment Fraud Division (IUFD) works to protect consumers and the integrity of the insurance system by investigating and prosecuting those who commit fraud against all types of insurers, including the Commonwealth’s unemployment insurance and workers’ compensation systems. The prosecution of insurance fraud helps prevent the increase in premiums and taxes that are the result of fraudulent insurance claims. In 2012, the IUFD obtained more than $1,647,000 in restitution orders in 32 matters.
To report unemployment fraud call the EOLWD/DUA’s Fraud Hotline @ 1-800-354-9927 or visit: www.mass.gov/lwd/ui-fraud anytime, 24 hours a day. Callers may remain anonymous.
This case was prosecuted by Assistant Attorney General Joshua Pakstis AG Coakley’s Insurance and Unemployment Fraud Division with assistance from investigators from the Attorney General’s Office and investigator Mark St. Onge from EOLWD\DUA.