Woman Pleads Guilty in Scheme to Steal More Than $58,000 in Unemployment Benefits While Husband was Incarcerated
Defendants Allegedly Schemed to Fraudulently Collect Benefits During Incarceration
BOSTON – A Somerville woman has pleaded guilty in connection with a scheme to fraudulently collect more than $58,000 in unemployment benefits during her husband’s incarceration, Attorney General Martha Coakley announced today.
“This defendant conspired to fraudulently collect thousands of dollars in unemployment benefits during her husband’s incarceration,” AG Coakley said. “The detection and prosecution of these crimes are imperative to returning funds to the Commonwealth and maintaining the integrity of the system.”
“Unemployment insurance is a temporary income protection program for workers who have lost their jobs through no fault of their own, but desire to work and are available to report to a job,” said Labor and Workforce Development Secretary Rachel Kaprielian. “The Division of Unemployment Assistance has zero tolerance for those who try to defraud and abuse unemployment insurance.”
Nancy Smith, 42, pleaded guilty Wednesday in Suffolk Superior Court to charges of Unemployment Fraud (97 counts), Larceny Over $250 by False Pretenses, Conspiracy to Commit Unemployment Fraud, and Conspiracy to Commit Larceny. After the plea was entered, Superior Court Judge Peter Krupp sentenced Smith to five years probation with the condition that full restitution is paid.
A Suffolk County Grand Jury returned indictments against the Nancy Smith and co-defendant Kevin Smith on September 30. Kevin Smith is charged as follows:
Kevin Smith, 43, of Mattapan:
- Unemployment Fraud (97 counts)
- Larceny Over $250 by False Pretenses
- Conspiracy to Commit Unemployment Fraud
- Conspiracy to Commit Larceny
- Habitual Offender (4 counts)
Authorities allege the defendants conspired to steal thousands of dollars in unemployment benefits on behalf of Kevin Smith during his incarceration between August 2009 and July 2011. The alleged scheme was initially investigated by the Executive Office of Labor and Workforce Development’s Department of Unemployment Assistance (EOLWD\DUA) and referred to the Attorney General’s Office for prosecution.
According to authorities, Smith applied for and began receiving unemployment benefits from EOLWD\DUA in January 2009 after being separated from his employer. In August 2009 Smith was incarcerated on unrelated charges. During his incarceration Smith allegedly maintained contact with his wife Nancy through phone calls from jail, providing instructions as to what to say and how to proceed in order to process his unemployment claim.
Based on this information authorities allege that Nancy Smith, or someone acting at her direction, falsely certified his unemployment claims over the phone notifying EOLWD\DUA that he was not working, that he was able to work and was available for work for 97 weeks from August 2009 through July 2011. Further investigation revealed that Nancy Smith allegedly cashed the unemployment benefit checks and shared the proceeds with Kevin Smith.
As a result of this alleged scheme, the defendants fraudulently collected unemployment benefits totaling more than $58,000 while Kevin Smith remained incarcerated.
The defendants were arraigned on Oct. 13, 2013 in Suffolk Superior Court where each pleaded not guilty. Kevin Smith was ordered held on $5,000 bail. Under the conditions of probation, both defendants were ordered to check in to probation twice a week by telephone, alert the Attorney Generals’ office if they gain or lose a job and that they not seek any public benefit without alerting the AG’s office. Nancy Smith pleaded guilty and was sentenced on Wednesday. Kevin Smith is due back in court on April 30.
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.
In 2013, AG Coakley’s Insurance and Unemployment Fraud Division (IUFD) recovered more than $1.4 million in restitution for the state. The 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.
To report unemployment fraud call the EOLWD/DUA’s Fraud Hotline at (800) 354-9927 or visit: www.mass.gov/lwd/ui-fraud anytime, 24 hours a day. Callers may remain anonymous.
This case is being prosecuted by Assistant Attorney General David Clayton of AG Coakley’s Insurance and Unemployment Fraud Division with assistance from investigator Steven Pfister of the Attorney General’s Office and investigator John Kiernan from EOLWD\DUA.