United States Attorney Benjamin B. Wagner
Eastern District of California
EDD Employee and Three Others Indicted on Disability Fraud Charges
|FOR IMMEDIATE RELEASE||
Tuesday, October 16, 2012
Docket #: 2:12-cr-364 GEB
SACRAMENTO, Calif. — An employee of the Employment Development Department and two others were arrested today for a scheme to defraud the EDD Disability Insurance Program, United States Attorney Benjamin B. Wagner announced.
The nine-count indictment that was unsealed today charged EDD employee Simeon Shawnise Gregory, 35, of Moreno Valley; Sarah Elizabeth Trout, 35, of Riverside; Theresa Helena Campbell, 37, of Riverside; and Terrance Rychan Smalls, 32, of Moreno Valley, with mail fraud. Gregory is also charged with aggravated identity theft. Gregory, Trout, and Smalls were arrested this morning. Campbell has not yet been arrested.
According to the indictment, Gregory used her position as an EDD Disability Insurance Program Representative to improperly process and manipulate the claims of Trout, Campbell, and Smalls. In return for fraudulently extending her disability claim, Trout paid Gregory up to half of her disability benefits. For Campbell and Smalls, Gregory caused EDD to issue specific payments, inactivated warning flags, and forged doctor’s certificates regarding the claimed disability. As a result of this scheme, the defendants defrauded the State of California of more than $360,000.
“Disability Insurance benefits are vitally important to Californians, and EDD criminal investigators actively pursue and prosecute anyone who defrauds the system so benefits are preserved for those in need,” said Lisa Schmith, Chief of EDD Investigation Division.
This case is the product of an investigation by the Employment Development Department, Investigations Division. Assistant United States Attorney Jared C. Dolan is prosecuting the case.
If convicted, the defendants face a maximum statutory penalty of 20 years in prison. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations, and the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
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