Motion and Proposed Order to Seal — U.S. v. Richmond (E.D. Cal.)

Summary

The government's motion and proposed order to seal a superseding indictment in United States v. Daryol Richmond, Telvin Breaux, Holly White and others, No. 1:21-cr-00184, in the U.S. District Court for the Eastern District of California, filed December 16, 2021 as Document 47 and ordered by a U.S. Magistrate Judge on December 17, 2021. It asks that the superseding indictment be redacted and sealed until newly charged defendants who are out of custody are in custody or on bail, and attaches the redacted indictment. That indictment charges conspiracy to commit mail fraud under 18 U.S.C. § 1349 and aggravated identity theft under 18 U.S.C. § 1028A(a)(1). It alleges that from about June 2020 to December 2020 the defendants, including inmates, caused over 400 false unemployment insurance claims to be filed with the California EDD using other people's identities.

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“Motion and Proposed Order to Seal — U.S. v. Richmond (E.D. Cal.).” Original at archive.org. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/court-filing-no-1-21-cr-00184-dkt-47-e-d-cal-bf28d93c59/, SHA-256 8008dbf3ddbd69b5fc122bc26f7120fb498b57f39c6fedce5aac237a5e155466.

Full text

Case 1:21-cr-00184-ADA-BAM Document 47 Filed 12/16/21 Page 1 of 31

1 PHILLIP A. TALBERT
Acting United States Attorney FILED
2 JOSEPH D. BARTON Dec 16, 2021
Assistant United States Attorney CLERK, U.S. DISTRICT COURT
EASTERN DISTRICT OF CALIFORNIA
3 2500 Tulare Street, Suite 4401
Fresno, CA 93721
4 Telephone: (559) 497-4000
Facsimile: (559) 497-4099
5

7
Attorneys for Plaintiff
United States of America
SEALED
8 IN THE UNITED STATES DISTRICT COURT
9 EASTERN DISTRICT OF CALIFORNIA
10

11 UNITED STATES OF AMERICA, CASE NO. 1:21-CR-00184 DAD-BAM
12 Plaintiff, MOTION AND PROPOSED ORDER TO
SEAL SUPERSEDING INDICTMENT
13 v.

14 DARYOL RICHMOND, aka “Nutcase,”
“Nuttcase,” and “Nuttcase 3x,”
15
TELVIN BREAUX, aka “AJ” and
16 “Lilcup,” HOLLY WHITE,
CECELIA ALLEN, aka “Cece” and “Cee
17 Cee,” FANTASIA BROWN, aka “Tay
Tay,” TONISHA BROWN,
18
FANTESIA DAVIS, aka “Tesia,” and
19 SHANICE WHITE,
Defendants.
20

21 The government moves the Court, pursuant to Rule 6(e) of the Federal Rules of
22 Criminal Procedure, to order that the Superseding Indictment returned by the Grand Jury
23 on December 16, 2021, charging the above defendants with violations of 18 U.S.C. § 1349 –
24 Conspiracy to Commit Mail Fraud; 18 U.S.C. § 1028A(a)(1) – Aggravated Identity Theft;
25 18 U.S.C. §§ 1028A(a)(1) and 2 – Aggravated Identity Theft and Aiding and Abetting; and
26 Criminal Forfeiture, be redacted and sealed so that the new defendants who were not
27 charged in the initial indictment and are currently out of custody do not become aware of
28 the indictment until they are either in custody or have been given bail. A copy of the

1
Case 1:21-cr-00184-ADA-BAM Document 47 Filed 12/16/21 Page 2 of 31

1 redacted Superseding Indictment is attached to this Motion. The new defendants are:
2 Cecelia Allen, Fantasia Brown, Tonisha Brown, Fentesia Davis, and Shanice White. The
3 government also moves the Court to order that no one shall disclose the existence of the
4 Superseding Indictment or any arrest warrants issued pursuant to the indictment as to
5 the new defendants, except when necessary for execution of the warrants.
6
DATED: December 17, 2021 Respectfully submitted,
7

8
PHILLIP A. TALBERT
9 Acting United States Attorney

10
By /s/ Joseph D. Barton
11
JOSEPH D. BARTON
12 Assistant U.S. Attorney

14
IT IS SO ORDERED.
15
Dated: December 17, 2021 _____________________________
16 BARABARA A. McAULIFFE
U.S. Magistrate Judge
17

2
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REDACTED SUPERSEDING INDICTMENT
Case 1:21-cr-00184-ADA-BAM Document 47 Filed 12/16/21 Page 4 of 31
Case 1:21-cr-00184-ADA-BAM Document 47 Filed 12/16/21 Page 5 of 31

1 I. INTRODUCTION

2 At all relevant times:

3 1. Defendant TELVIN BREAUX was an inmate at the California Department of

4 Corrections and Rehabilitation’s (“CDCR”) California Correctional Institution, which is located in

5 Tehachapi, California, in the State and Eastern District of California.

6 2. Defendant DARYOL RICHMOND was an inmate at the CDCR’s Kern Valley State

7 Prison, which is located in Delano, California, in the State and Eastern District of California.

8 3. Defendants HOLLY WHITE,

9 were known to defendants BREAUX and

10 RICHMOND, and each other, and resided in the Southern California area.

11 4. “J-Pay” was a prison-based email service provider that allowed inmates and non-inmates

12 to setup accounts and email each other for a fee.

13 II. BACKGROUND ON CALIFORNIA’S UNEMPLOYMENT INSURANCE SYSTEM

14 5. The Social Security Act of 1935 established the Federal and State Unemployment

15 Insurance System, which provides benefits to persons who are out of work through no fault of their own.

16 Unemployment insurance benefits are funded by a combination of federal and state funds.

17 6. The California Employment Development Department (“EDD”) administers the

18 unemployment insurance system for the State of California.

19 7. Generally speaking, before March 2020, only individuals who were wage earners were

20 eligible to receive unemployment insurance benefits and the benefits were for a limited period and

21 capped at a certain amount. Self-employed individuals were ineligible. Beginning in March 2020,

22 however, federal legislation made significant changes to the unemployment insurance system in

23 response to the Coronavirus Disease 2019 (“COVID-19”) pandemic, including:

24 a. Making individuals who were self-employed eligible;

25 b. Extending the duration of the benefits period; and

26 c. Increasing the amount of benefits that could be paid out to individuals.

27 8. Overall, more than $300 billion in additional federal funds have been appropriated for

28 unemployment insurance benefits during the COVID-19 pandemic.

INDICTMENT 2
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1 9. An individual may apply to the EDD for unemployment insurance benefits by submitting

2 a claim in-person, over the telephone, by mail, or online, and the claim can be paid retroactively to the

3 date the individual became unemployed. The individual is asked to provide his or her true name, date of

4 birth, and Social Security Number (“SSN”). The individual is also asked several questions to establish

5 his or her eligibility for benefits, including what is his or her normal occupation, what was his or her last

6 day worked and whether he or she recently became unemployed, and whether he or she is currently

7 available to work. Finally, the individual is asked to provide his or her mailing address, email account,

8 and telephone number, among other information.

9 10. After the EDD approves an individual’s unemployment insurance claim, the benefits are

10 paid bi-weekly. The benefits may be deposited onto a debit card that is issued by the Bank of America

11 and mailed to the individual through the United States mail. The EDD then requires that the individual

12 submit bi-weekly certifications to confirm that he or she is still looking for work and has not refused any

13 work to continue receiving the benefits. The certification can be submitted in-person, over the

14 telephone, by mail, or online.

15 III. CONSPIRACY

16 11. Beginning on a date unknown to the Grand Jury, but not later than in or around June

17 2020, and continuing until at least in or around December 2020, in the State and Eastern District of

18 California and elsewhere, defendants RICHMOND, BREAUX, HOLLY WHITE,

19 , and others known and unknown to the

20 Grand Jury, did knowingly conspire to defraud the EDD and the United States, and to obtain money and

21 property from the EDD and the United States, by means of materially false and fraudulent pretenses,

22 promises, and representations, and to cause mail matter to be placed into a post office or other

23 authorized depository for mail matter, and to be sent and delivered by the United States Postal Service

24 according to the direction thereon, all in violation of Title 18, United States Code, Section 1341.

25 IV. MANNER AND MEANS OF THE CONSPIRACY

26 12. Defendants RICHMOND, BREAUX, HOLLY WHITE,

27 , and others known and unknown to the Grand

28 Jury, carried out the conspiracy by the following manner, means, and acts, among others:

INDICTMENT 3
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1 13. Defendants RICHMOND and BREAUX used jails calls, J-Pay emails, and contraband

2 cell phones to communicate with the other defendants from prison.

3 14. The defendants obtained the names, dates of birth, and SSNs for inmates who were

4 incarcerated in prisons, non-inmates who did not know the defendants or authorize them to possess their

5 personal information, and minor children. The defendants subsequently exchanged this information

6 with each other and caused over 400 false and fraudulent unemployment insurance claims to be

7 submitted online to the EDD in these individuals’ identities. This included the identities of inmates

8 H.H., J.C., A.P., non-inmates C.W.M., G.J., and Y.J., and the minor child K.S.

9 15. The defendants caused different mailing addresses and fictitious email accounts to be

10 provided to the EDD for the false and fraudulent claims to try to avoid detection by government

11 authorities. At times, they paid family members and associates to allow those family members and

12 associates’ physical addresses to be used for the claims and to create the email accounts.

13 16. The defendants caused the underlying applications for the claims to contain numerous

14 false and fraudulent representations, including that the defendants submitting the claims were the

15 identified individuals, that those individuals were previously self-employed forty or more hours per

16 week as clothing merchants, handymen, mechanics, and other occupations in the Southern California

17 area, that the individuals last worked within the prior few weeks or months and recently became

18 unemployed because of the COVID-19 pandemic, and that the individuals were available to work.

19 17. For example, in the application that the defendants caused to be submitted in inmate

20 H.H.’s identity on or about July 26, 2020, they falsely and fraudulently represented that H.H. was

21 applying for benefits, that H.H. was previously self-employed forty hours per week as a handyman in

22 San Bernardino County, California, that H.H. last worked in July 2020 and recently became unemployed

23 because of social distancing and lockdown measures implemented to fight the COVID-19 pandemic, and

24 that H.H. was looking for work. As the defendants were aware, these representations were not true and

25 H.H. had been incarcerated at all times since the early 2000s.

26 18. As another example, in the application that the defendants caused to be submitted in

27 C.W.M.’s identity on or about July 20, 2020, they falsely and fraudulently represented that C.W.M. was

28 applying for benefits, that C.W.M. was previously self-employed forty hours per week selling

INDICTMENT 4
Case 1:21-cr-00184-ADA-BAM Document 47 Filed 12/16/21 Page 8 of 31

1 merchandise to clothing stores and boutiques in Los Angeles County, California, that C.W.M. last

2 worked in July 2020 and recently became unemployed due to COVID-19, and that C.W.M. was looking

3 for work. As the defendants were aware, these representations were not true and they used C.W.M.’s

4 identity without C.W.M.’s knowledge or authorization.

5 19. In the application that the defendants submitted for the minor child K.S. on or about

6 August 1, 2020, they falsely and fraudulently represented that the application was being submitted by

7 K.S., that K.S. was previously self-employed forty hours per week selling merchandise to clothing stores

8 and boutiques in Riverside County, California, that K.S. last worked in July 2020 and recently became

9 unemployed because of quarantine requirements implemented to fight the COVID-19 pandemic, and

10 that K.S. was looking for work. As the defendants were aware, these representations were not true and

11 K.S. was under the age of five at that time.

12 20. The defendants frequently caused the applications to falsely and fraudulently represent

13 that the individuals in whose names they submitted the claims had access and control over the mailing

14 addresses, email accounts, and telephone numbers listed in the applications, when in fact the defendants

15 retained access and control over such addresses, accounts, and numbers.

16 21. The defendants knew at the time they submitted the applications to the EDD that the

17 applications contained false and fraudulent representations.

18 22. The defendants’ false and fraudulent representations to the EDD were material to the

19 agency’s decisions to approve the unemployment insurance claims. The agency may deny a claim if the

20 identified individual did not authorize the claim, did not previously work in California within a

21 proscribed period or recently become unemployed because of the COVID-19 pandemic, or is not

22 currently available to work, including because the individual is an incarcerated prisoner or a minor child.

23 The agency may also deny a claim if the identified individual does not have access or control over the

24 listed mailing address, email account, or telephone number.

25 23. The defendants’ false and fraudulent representations caused the EDD to deposit benefits

26 onto debit cards that were issued by the Bank of America and sent through the United States mail to

27 addresses over which the defendants had access and control. The defendants who were not incarcerated,

28 and the defendants’ family members and associates, then picked up the debit cards and used them to

INDICTMENT 5
Case 1:21-cr-00184-ADA-BAM Document 47 Filed 12/16/21 Page 9 of 31

1 make cash withdrawals in furtherance of the conspiracy. To further avoid detection by government

2 authorities, the defendants frequently made the cash withdrawals at different locations, on different days

3 and times, and in varying amounts.

4 24. Defendants RICHMOND and BREAUX typically instructed the other defendants on how

5 and when to distribute the proceeds of the scheme. At times, the defendants caused the proceeds from

6 the scheme to be stored in safe deposit boxes and to be transferred to various individuals, including

7 amongst the defendants, through computer applications like Cash App and Zelle.

8 25. The defendants periodically checked the status of the fraudulent unemployment insurance

9 claims with the EDD to see whether continuing certifications of eligibility were required to be submitted

10 to continue receiving the benefits. When EDD required such certifications, the defendants caused false

11 and fraudulent certifications of eligibility to be submitted to EDD, causing EDD to continue authorizing

12 benefit payments on the claims.

13 26. At times, when the debit cards for certain claims were frozen for suspected fraud,

14 defendants BREAUX, called the EDD and Bank of America

15 and impersonated the identified individuals in attempts to unfreeze the debit cards.

16 27. As a result of the conspiracy, the defendants, and others known and unknown to the

17 Grand Jury, caused fraudulent unemployment insurance claims to be submitted to the EDD in excess of

18 $25,000,000, and caused the EDD and the United States to incur more than $5,000,000 in actual losses.

19 The defendants used the proceeds of the scheme for their own benefit and the benefit of others who were

20 not entitled to such funds, including to purchase vehicles, furniture, handbags, and jewelry.

21 28. In carrying out the conspiracy, the defendants acted at all times with the intent to defraud.

22 All in violation of Title 18, United States Code, Section 1349.

23 COUNTS TWO AND THREE: [18 U.S.C. § 1028A(a)(1) – Aggravated Identity Theft]

24 The Grand Jury further charges:

25 DARYOL RICHMOND, aka “Nutcase,” “Nuttcase,” and “Nuttcase 3x,” and
26 TELVIN BREAUX, aka “AJ” and “Lilcup,”
defendants herein, as follows:
27
29. Paragraphs 1 through 10 and 12 through 28 are incorporated by reference as though they
28

INDICTMENT 6
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