Feds seize $700,000 in suspected multi-state unemployment fraud case out of East Tennessee
Mariah Timms Brett Kelman-Nashville Tennessean
Federal authorities seized more than $700,000 and hundreds of prepaid debit cards from an East Tennessee man they suspect of using stolen identities of real people to file fraudulent unemployment claims in New York, Illinois and Ohio, according to newly filed federal court documents. Court documents dont make it clear how many fraudulent claims are alleged, but the large amount of money involved suggests that schemers either filed numerous false claims or fraudulently collected unemployment payments for months or both. Details are sparse because the scheme is still under investigation. Federal prosecutors said in court documents the case is an active criminal investigation, but no federal charges appear to have been filed at this time. A court clerk in Loudon County confirmed criminal charges against at least one suspect are being considered by a local grand jury. Valentine Odije, then 32, was named repeatedly throughout the documents as a subject of the investigation.Investigators say they found hundreds of bank cards from an online banking service activated in the real names of residents in the three states, many of whom might not know their identities were being misused. The cards already had been used in purchases and withdrawals of more than $160,000 by the time the authorities caught up to them. The Labor Department inspector general's office estimates that more than $63 billion has been paid out improperly through fraud or errors nationwide since March 2020, USA Today reported. Withdrawals reported to sheriffIn July, a Lenoir City Walmart security guard noticed four women were cashing out and buying money orders worth thousands using different cards, all from Green Dot Bank, according to a warrant filed Tuesday in East Tennessee District Court.
The employee notified local authorities, including
Loudon County Sheriff's Lt. Shane Ezell, documents show. He and
other law enforcement arrived on the scene shortly after. Details of
the arrest were included in an affidavit filed by U.S. Secret
Service Special Agent Michael A. Hauke.
The women, unnamed in the affidavit, left the store and entered a Range Rover with Georgia plates that had been parked outside, law enforcement reported. A man then exited the vehicle and headed into the store while the occupants of the Range Rover left the scene, the warrant indicates. He was later identified as Valentine Odije. As Ezell watched the Range Rover leave, the Walmart employee notified him that the man was attempting to also withdraw money orders and cash using a card from the same online bank, Hauke reported. "Believing a scam and fraud was occurring" law enforcement detained Odije inside the store and stopped the Range Rover at a nearby Chick-fil-A location, Hauke wrote. Drug detection dogs were used on the vehicle, and Hauke reported a search found seven grams of THC edibles and suspected ecstasy pills in the Range Rover. Three hundred Green Dot Bank cards, "numerous" money orders and a brown paper BeniHana bag with more than $23,000 were also found in the vehicle, he said. Inside the Walmart, Hauke reported agents found a fake ID, three Green Dot Bank cards in other people's names and approximately $3,000 in cash in Odije's possession. Green Dot Bank is a California-based banking system that has moved fully online in recent years, according to the company's website. It sells debit cards in stores like Walmart that a user can register or activate with a deposit. Secret Service agents collected $638,659.43 of the possible stolen unemployment funds from Green Dot last month, as well as $86,651.68 in cash taken during Odije's arrest. Suspect faces local chargesOdije was booked into the Loudon County jail early the following morning on several charges. He was released on bond in October, according to the Loudon County Sheriff's Office. A Loudon County Circuit Court clerk confirmed three charges against him were bound over to a grand jury forgery, criminal simulation and civil possession/casual exchange. The grand jury had not returned a report on cases including Odije's as of Wednesday afternoon. No federal charges against Odije had been publicly filed as of Wednesday afternoon. Hauke's affidavit, though, lays out the case for charging Odije under federal fraud laws. If charged and convicted, he could face a fine and/or up to 10 years in prison. Investigations have found "no evidence establishing any other potential sources of funds" on the seized bank cards besides unemployment benefits. People looking to profit off identity theft may be using data stolen in breaches that predate the pandemic, USA TODAY found. With those benefit options increasing last year about $550 billion was spent in support of those out of work in 2020, compared with an average of $32 billion in the previous five years the opportunity to defraud states also grew. |
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4/19/21