TRENTON
– Attorney General Jeffrey S. Chiesa
and Labor Commissioner Harold J. Wirths today
announced the indictment of 30 individuals
in alleged schemes led by five members of
a Newark family to defraud the State of New
Jersey of more than $2 million by filing false
claims for unemployment benefits in the names
of numerous people, including co-conspirators
and individuals whose identities were stolen.
In some instances, claims were filed for people
who were deceased. The charges stem from “Operation
Labor Day,” a joint investigation by
the New Jersey Division of Criminal Justice
and the New Jersey Department of Labor &
Workforce Development. The
Division of Criminal Justice obtained state
grand jury indictments – returned
on March 1, but sealed until late yesterday
– charging these five defendants who
allegedly led the criminal schemes:
-
Terry E. Dilligard II,
35, of Newark;
- Janice
Allen,
55, of Newark, his mother;
- Janice
Dilligard, 35, of Newark, his
twin sister;
- Monique
Valentine, 33, of Roselle, his
former girlfriend and the mother of his
children; and
- Terry
Dilligard Sr., 57, of DeLand,
Florida, his father.
All
five of these defendants face second-degree
charges, including counts of theft by deception
and conspiracy, which carry a sentence of
five to 10 years in state prison. In addition,
Terry Dilligard II is charged with first-degree
money laundering, which carries a sentence
of 10 to 20 years in prison.
These
five individuals and 25 other defendants
are charged with filing false unemployment
insurance claims with the Department of
Labor between August 2006 and November 2010
which resulted in the theft of more than
$2 million in unemployment benefits. The
claims were based upon fictitious assertions
of previous employment held by the claimants,
primarily with the University of Medicine
and Dentistry of New Jersey, Newark Beth
Israel Hospital and two private employers.
“This
is an outrageous case of fraud and greed
that revolves around members of a Newark
family who allegedly orchestrated schemes
to steal over $2 million from the state’s
unemployment insurance fund,” said
Attorney General Chiesa. “In this
tough economy, unemployment benefits are
a financial lifeline for hardworking New
Jersey residents who have lost their jobs,
and we cannot afford to have them drained
by con artists. We will aggressively prosecute
such crimes.”
Commissioner
Wirths noted that the Department of Labor
has implemented new security measures under
the administration of Governor Chris Christie
to eliminate weaknesses exploited by the
defendants and detect fraud in connection
with claims filed for unemployment benefits.
Additional details about those measures
are provided below.
“It’s
harder to retrieve money once it’s
out the door. We are now preventing fraud
before it happens, and if we catch people
collecting unemployment when they shouldn’t,
we will go after them,” said Commissioner
Wirths. “My goal is to protect the
Unemployment Insurance Fund for those people
who paid into it and, because they fell
on hard times, need the safety net it provides.
Those who would illegally deplete it will
go to prison.”
Arrest
warrants were issued for 25 defendants.
Yesterday, detectives, investigators and
agents of the cooperating law enforcement
agencies arrested more than a dozen of the
wanted individuals, including Janice Dilligard,
Valentine and Allen. Terry Dilligard II
remained a fugitive sought on the state’s
arrest warrant. Most of those arrested were
lodged in the Mercer County Jail.
One
indictment announced today charges Dilligard
II, his ex-girlfriend, Valentine, and his
father, Dilligard Sr., with defrauding the
State of New Jersey of a total of $1,489,411
in unemployment benefits. Dilligard II and
his father are charged with stealing $174,848
of that total by filing claims using identities
stolen from nine voters in Florida. Dilligard
Sr., who was a city commissioner in Florida,
allegedly obtained their personal information,
including Social Security numbers and dates
of birth, while registering voters. The
son allegedly paid the father a share of
the benefits that were fraudulently obtained.
They are charged with second-degree identify
theft for that alleged conduct.
The
son is charged alone with stealing another
$810,345 of the total covered by that indictment,
and he and Valentine are charged together
with stealing $478,768. Valentine is charged
alone with stealing $25,450. Dilligard II
and Valentine allegedly filed false claims
in the names of numerous individuals. Twenty-one
of those individuals are charged in 21 separate
indictments with filing or allowing Dilligard
II to file false claims in their names and
sharing the stolen benefits with him.
A
separate indictment unsealed yesterday charges
Janice Dilligard and her mother, Janice
Allen, with stealing $585,304 in unemployment
benefits by filing false claims in the names
of numerous claimants, including relatives
and people who were deceased. Their alleged
conspiracy was separate from the conspiracies
of Terry Dilligard II, Dilligard Sr. and
Valentine. The following four defendants
were also named in the indictment charging
the mother and daughter:
- George
Dononcourt, 28, of West Orange;
- George
Ross,
44, of Newark;
- Floyd
Robinson,
39, of Newark; and
- Terrell
Evans, 37, of Irvington.
They
allegedly assisted the two women in the
fraud and shared in the stolen unemployment
benefits. Each of the four is charged with
second-degree conspiracy and third-degree
theft by unlawful taking.
In
many instances, individual false claims
allegedly filed by the defendants would
generate tens of thousands of dollars in
benefits. Benefit amounts on a single claim
reached as high as $56,915. The two main
indictments combined allege a total of $2,074,715
in stolen benefits.
“This
was a complex case involving numerous conspirators
and extensive financial evidence that had
to be tied together,” said Stephen
J. Taylor, Director of the Division of Criminal
Justice. “Our Labor Prosecutions Unit
and the Department of Labor conducted a
very skillful and thorough investigation.
We will continue this partnership to protect
the integrity of the unemployment insurance
program.”
The
indictments were presented to the state
grand jury by Deputy Attorneys General Phillip
Leahy and Anthony Torntore. The investigation
was conducted for the Division of Criminal
Justice by Detective Kimberly Allen and
Detective Eric Ludwick of the Financial
& Computer Crimes Bureau, and Deputy
Attorneys General Leahy and Torntore of
the Labor Prosecutions Unit, supervised
by Supervising Deputy Attorney General Andrew
Butchko, Chief of the Specialized Crimes
Bureau. Retired Supervising Deputy Attorney
General Scott Patterson also worked on the
investigation. The investigation was conducted
for the Department of Labor & Workforce
Development, Bureau of Benefit Payment Control,
by Supervising Investigator Micheal Kulyk,
Supervisor of Investigations Michael Marich,
former Supervising Investigator Susan Zamparelli,
and former Acting Chief of the Bureau of
Benefit Payment Control John Galvin. Attorney
General Chiesa thanked the Office of Labor
Racketeering & Fraud Investigations
within the U.S. Department of Labor’s
Office of Inspector General (OIG), under
the direction of Robert L. Panella, special
agent in charge of the OIG New York Regional
Office, for its valuable assistance throughout
the investigation. He also thanked the following
agencies which provided assistance at various
times throughout the investigation: Boonton
Police Department, New Jersey Human Services
Police and the U.S. Marshals Service NY/NJ
Regional Fugitive Task Force.
The
defendants allegedly filed most of the false
claims by submitting online forms to the
Department of Labor, including the required
personal identifiers of real people as well
as fictitious information on previous employment.
At the time of the alleged conduct, unemployment
benefits could be paid by check or could
be deposited directly into a bank account
if the claimant provided account information.
Most of the benefits paid on the alleged
false claims filed by Terry Dilligard II
were deposited directly into Internet bank
accounts which were set up in the names
of the claimants but secretly controlled
by Dilligard II. The accounts had affiliated
debit cards, which Dilligard II allegedly
used to withdraw money at automated teller
machines. He allegedly gambled large sums
of the stolen benefits at a casino in Atlantic
City.
Janice
Dilligard and Janice Allen allegedly had
some stolen benefits deposited directly
into bank accounts, but they also allegedly
obtained numerous benefit checks, which
they had mailed to various addresses where
they would have access to them. Many checks
were endorsed by Allen and deposited into
her bank account. In addition, Dononcourt, Ross, Robinson and Evans allegedly
endorsed benefit checks and deposited them
into their bank accounts, sharing the proceeds.
All
five primary defendants are charged with
money laundering in connection with transactions
involving stolen benefits. Terry Dilligard
II faces two counts of first-degree money
laundering for allegedly possessing criminal
proceeds and engaging in transactions intended
to conceal the nature and source of those
proceeds. Valentine, Allen and Janice Dilligard
are each charged with second-degree money
laundering, and Dilligard Sr. is charged
with third-degree money laundering. Dilligard
II also faces a second-degree money laundering
count, and Allen faces a third-degree count.
The
investigation began in 2010 when a debit
card company affiliated with a bank used
by the defendants alerted the New Jersey
Department of Labor & Workforce Development
about suspicious activity related to debit
accounts, including account holders who
were deceased and unemployment benefits
for multiple claimants being deposited into
the same account. The labor department’s
fraud unit, the Bureau of Benefit Payment
Control, identified numerous false claims
linked to the accounts and alerted the Division
of Criminal Justice. The Division of Criminal
Justice and Department of Labor & Workforce
Development then commenced their joint investigation,
“Operation Labor Day.”
The
Department of Labor & Workforce Development
has implemented the following anti-fraud
measures since the alleged criminal conduct
in this case occurred:
-
Replaced paper checks with Debit Cards
to distribute benefits more securely and
at a cost savings.
-
Created a new Anti-Fraud unit headed by
former FBI agent to improve fraud detection.
-
Enlisted and continue to deploy new software
to detect and thwart fraud practices,
such as those used in this case and other
schemes.
-
Implemented a cross-checking program by
which unemployment insurance recipients
are matched against national and state
“new hire” data to thwart
the most common fraud, which is people
collecting UI after they have found employment.
An estimated $100 million has been saved
since March 2011 through this effort,
and the U.S. Department of Labor issued
two national innovation awards to New
Jersey for this anti-fraud effort.
The
following 21 defendants were charged in
21 separate state grand jury indictments
with third-degree conspiracy, third-degree
theft by deception, and fourth-degree unsworn
falsification:
-
Leondreau Belton,
32, of Newark;
- Juvaughn
Bonney,
23, of Newark;
- Antoine
Boone,
22, of Newark;
- Paul
Braswell, 22, of Newark;
- Darrin
Cheeks,
45, of Irvington;
- Ryan
Garnes,
33, of Irvington;
- Khalif
Grant, 31, of Newark;
- Pamela
Green, 41, of Newark;
-
Tony Hardiman, 48, of
Newark;
-
Ronald R. Hobbs, 34,
of Irvington;
- Samaad
Mathis, 32, of Newark;
- Brian
Ross, 31, of East Orange;
- Rodriguez
Sharpe, 35, of East Orange;
- Robert
Shein, 31, of Newark;
- Jibril
Stokes, 27, of Newark;
- Cheryl
Warren, 51, of Newark;
- Kali
Warren, 28, of South Orange;
- Karriem
Warren, 32, of Hillside;
- Rasjhon
Warren, 32, of Newark;
- Evan
Davis Weems, 23, of Irvington;
and
- Tina
M. Young, 31, of Newark.
First-degree
crimes carry a sentence of 10 to 20 years
in state prison and a fine of up to $200,000;
second-degree crimes carry a sentence of
five to 10 years in state prison and a fine
of up to $150,000; third-degree crimes carry
a sentence of three to five years in state
prison and a fine of up to $15,000; and
fourth-degree crimes carry a maximum sentence
of 18 months in prison and a fine of up
to $10,000. The money laundering counts
carry an enhanced fine of up to $500,000.
The
indictments
are merely accusations and the defendants
are presumed innocent until proven guilty.
The indictments were handed up to Superior
Court Judge Pedro J. Jimenez, Jr. in Mercer
County, who assigned them to Mercer County.
Attorney
General Chiesa and Director Taylor noted
that the Division of Criminal Justice has
established a toll-free tipline 1-866-TIPS-4CJ
for the public to report corruption, financial
crime and other illegal activities. The
public can also log on to the Division of
Criminal Justice webpage at www.njdcj.org
to report suspected wrongdoing. All information
received through the Division of Criminal
Justice tipline or webpage will remain confidential.
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