A former employee of the California Employment Development Department (EDD) and her former boyfriend have pleaded guilty to fraudulently obtaining over $750,000 in COVID-19 unemployment benefits. Phyllis Hope Stitt, 61, from Carson, admitted to one count of conspiracy to commit mail fraud and bank fraud. Her ex-boyfriend, Kenneth Earl Riley, 64, from South Los Angeles, also pleaded guilty to the same charge.
Stitt used her position at EDD from March 2020 to September 2021 to file at least 29 fraudulent unemployment insurance claims. This resulted in approximately $768,958 in losses for the department. She accessed personal information such as names and Social Security numbers without victims' consent to submit false claims.
The fraudulent applications falsely claimed that victims were unemployed due to the pandemic and actively seeking work. Many victims were actually employed or deceased during this period. Stitt used mailing addresses accessible by Riley for these applications. Debit cards and accounts from these fraudulent claims were accessed by Riley and others for cash withdrawals and purchases.
United States District Judge André Birotte Jr. has scheduled sentencing hearings for May 9, where each defendant could face up to 30 years in federal prison.
The Attorney General's COVID-19 Fraud Enforcement Task Force was established on May 17, 2021, enhancing efforts against pandemic-related fraud. On September 15, 2022, a COVID-19 Fraud Strike Force Team was created for large-scale financial fraud related to the pandemic.
Investigations were conducted by the United States Department of Labor – Office of Inspector General, FBI, and California Employment Development Department – Investigation Division. Assistant United States Attorney Steven M. Arkow is prosecuting this case.
For those with information about attempted COVID-19 frauds can report it via the National Center for Disaster Fraud Hotline or their web complaint form.