In Beverly hills, a police operation has caught 44 suspects. Between them, they are suspected of having committed a staggering $2.5 million in fraud by collecting Economic Development Department funds. The fraudsters were involved in a complex network that involved signing up for benefits under the name and addresses of strangers, and collecting the benefit cards by re-routing mail.
Mysterious Letters Arrive as Scammers Collect Funds
ABC 7 reports on methods used by the scammers, “…reports are sweeping California and other parts of the country of ordinary citizens opening their mailboxes to find not just a few, but stacks of letters and debit cards from the Employment Development Department — addressed to multiple complete strangers.
State legislators say it’s an alarming sign that a scam has been spreading far and wide with con artists roping unwitting residents into their ploy, and raking in possibly billions in fraudulent benefits.”
Often, the scammers target a residence they consider to be a soft target, usually the home of elderly persons, and use their name and address. Investigators are concerned that residents being targeted by the scam may be in danger from the fraudsters themselves.
Residents Are Plagued By the Letters
ABC 7 continues, “‘I can feel some of them have a debit card inside,” said Erasmo Garcia, San Bernardino County, as he felt the shape of a debit card inside a couple of the 32 letters he received.
A couple days later, he received a Postal Service ‘change of address’ notice for the debit card’s addressee, providing a clue as to one way the scam works. The scammers avoid detection by using random addresses, then divert the money with a postal change of address.
KGO-TV first reported about the scam last month when a man in Florida received 12 letters from the EDD and spent days wondering what EDD was, and what he should do with them. And a woman in Queens, N.Y. received more than 40 letters, raising her concerns that someone was roping her into a scam.
‘I don’t want the FBI knocking at my door,’ she said.
State legislators say the real worry may be a scammer knocking on the door. ‘Fraudsters know these addresses, we know they are staking out these addresses and in some cases they are breaking in,’ said Assemblyman Jim Patterson, (R-Fresno). The EDD asked residents to put those letters in the mailbox, marked return to sender, but Patterson said that turns the homes into a target.”
The EDD has admitted that there are reports of scammers breaking into residences to claim the benefit cards, so Patterson tells residents who receive them to drop the letters in a blue mail drop box and inform the police.
Details of the Arrests
ABC 7 reports details of the 44 arrests; “Forty-four people, primarily from other states, have been arrested in Beverly Hills in less than two weeks for alleged identity theft and California Employment Development Department fraud totaling over $2.5 million, authorities said Wednesday.
Investigators learned earlier this month that people were using stolen identities to fraudulently obtain EDD benefits loaded onto debit cards, which can be as high as $20,000, according to the Beverly Hills Police Department.
Cardholders can withdraw up to $1,000 a day per card.
‘Suspects have traveled primarily out of state to obtain these fraudulent EDD cards in California,” the Police Department said in a statement. The suspects allegedly used the cards ‘to lease short-term rentals, rent luxury vehicles, dine at restaurants and purchase high-end merchandise.”’
In the course of the investigation, 129 debit cards were discovered worth more than $2.5 million, along with 7 handguns and $289,000 in cash.
Investigators Are Looking For Information
This is a massive and complex operation, and investigators are still seeking information about the case. ABC 7 shares, “‘There are millions of tax dollars being spent fraudulently as a result of this trend,’ Beverly Hills Police Department Chief Dominick Rivetti said.
Anyone with information about the case is urged to call the Beverly Hills Police Department at (310) 285-2125.”
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