Albany, NY (June 03, 2011) -
The New York State Department of Labor and the Rockland County District Attorney's Office today announced the convictions of three people for Unemployment Insurance (UI) fraud. State Department of Labor investigators uncovered a complex fraud operation based in the Town of Haverstraw, Rockland County. The defendants filed multiple UI benefit claims from the same address and used UI benefit payment cards to withdraw thousands of dollars from ATMs in Rockland County.
On February 23, 2011, police arrested Yully Altagracia Vargas, 43, of 1 Broad Street, Haverstraw, N.Y. At the time of her arrest, Ms. Vargas had 17 UI benefit cards in her possession and over $10,000 in cash on hand.
On February 24, 2011, police arrested Seneida Diaz, 53, of 179 Route 210, Stony Point, N.Y. On February 25, 2011, they arrested Narciso Vargas, 51, of 1 Broad Street, Haverstraw, N.Y.
Today, Yully Altagracia Vargas pleaded guilty to Criminal Possession of Public Benefits Cards in the First Degree, a class C felony. Seneida Diaz and Narciso Vargas pleaded guilty to Criminal Possession of Public Benefits Cards in the Second Degree, a class D felony. All three were ordered to pay $10,000 in restitution. Sentencing is scheduled for August 26, 2011.
Executive Deputy Commissioner of Labor Mario J. Musolino said, "As a result of good casework, persistence and great partnership between the State Labor Department and Rockland County District Attorney Zugibe's office, we identified and shut down this fraudulent enterprise. The Department will continue to use every tool at its disposal while partnering with dedicated prosecutors across the state to root out Unemployment Insurance fraud."
In the summer of 2009, the Department of Labor began an investigation of the defendants' conduct based on a tip. During one surveillance operation, investigators saw two of the defendants use multiple UI benefit cards to withdraw over $15,000 in cash, within a 35-minute period, from ATMs in Rockland County. The investigation also included a review of bank records and a search of UI records.
The Department referred the evidence to the Rockland County District Attorney's Office for further investigation and prosecution. The Department and Rockland County District Attorney investigators conducted more surveillance and monitoring. Their work confirmed both the complex scheme to defraud New York's UI program and the identities of those involved with the theft.
On February 23, 2011, investigators executed search warrants at two locations in Rockland County and seized computer records, more than 30 UI benefit cards and large amounts of cash. The defendants were arrested shortly thereafter.
Rockland County District Attorney Thomas P. Zugibe said, "This corrupt conduct was committed at the expense of employers who pay into the UI Trust Fund. With the criminal pleas taken today, we are bringing these individuals to justice. My administration, along with the New York State Department of Labor, made combating UI fraud an utmost priority. We will continue our aggressive efforts to protect the integrity and health of the UI Trust Fund."
In addition to this matter, the Department of Labor continues to investigate complex fraud and identity theft through its Major Case Unit (MCU). The MCU uses enhanced data analysis and fraud detection tools to find, investigate and deter fraud in the UI program. They also follow up on tips from the public.
The investigation into this scheme is ongoing. Anyone with further information about this or other UI fraud should call the Department of Labor's toll-free fraud hotline at (888) 598-2077.
The Department of Labor and District Attorney Zugibe expressed thanks to Associate Investigator Michelle Martone and Investigator Naomi Jimenez of the Department of Labor, and Investigator Brendan Donohue of the Rockland County Special Investigations Unit for their assistance in this investigation. Executive Assistant District Attorney Gary Lee Heavner prosecuted these cases.
To learn more about the Department of Labor's fight against UI fraud, please visit www.labor.ny.gov.