Information — United States v. Justin D. Konikow (C.D. Cal., Dkt. 1, October 7, 2019)

Summary

Information, Document 1, filed October 7, 2019, in United States v. Justin D. Konikow, Case No. 2:19-cr-00605, U.S. District Court for the Central District of California, charging mail fraud under 18 U.S.C. § 1341. It alleges that from at least in or about October 2013 through at least in or about January 2017 the defendant, with others, devised a scheme to defraud California's Employment Development Department (EDD) of unemployment (UI) and disability (DI) benefits using fictitious companies, Amazing Events, Inc., and Paradise Weddings, Inc. It alleges at least 27 fraudulent claims seeking $253,008 on behalf of at least 15 fake claimants, and a mailing on or about November 24, 2014 of an EDD debit card carrying $450. The signature block names United States Attorney Nicola T. Hanna.

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Case 2:19-cr-00605-JAK Document1 Filed 10/07/19 Pageilof5 Page ID#:1

UNITED STATES DISTRICT COURT
FOR THE CENTRAL DISTRICT OF CALIFORNIA

Plaintiff, INFORMATION

UNITED STATES OF AMERICA,

Vv. [18 U.S.C. § 1341: Mail Fraud]
JUSTIN D. KONIKOW,

Defendant.

The United States Attorney charges:

[18 U.S.C. § 1341]

A. INTRODUCTORY ALLEGATIONS
1. At times relevant to this Information:
a. Defendant JUSTIN D. KONIKOW was a resident of Valley

Village, California, in Los Angeles County, within the Central
District of California.

b. California’s Employment Development Department (“HDD”)
was the administrator of the federal unemployment and disability
insurance benefit programs for the State of California. The EDD
provided unemployment insurance (“UI”) and disability insurance
(“DI”) benefits to claimants who the EDD determined were entitled to

receive such benefits via funds EDD caused to be loaded onto debit
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Case 2:19-cr-00605-JAK Document1 Filed 10/07/19 Page2of5 Page ID #:2

cards that Bank of America, N.A. (“BOA”) mailed to claimants (“EDD
debit cards”).

B. THE SCHEME TO DEFRAUD

2. From at least in or about October 2013 and continuing
through at least in or about January 2017, defendant KONIKOW,
together with others known and unknown to the United States Attorney,
knowingly and with intent to defraud, devised, participated in, |
executed and attempted to execute a scheme to defraud the United ‘
States of America, the State of California, and the EDD as to
material matters, and to obtain money and property from the EDD by
means of material false and fraudulent pretenses, representations,
and promises, and the concealment of material facts, in violation of
Title 18, United States Code, Section 1341.

3. The fraudulent scheme operated, in substance, in the
following manner:

a. Defendant registered fictitious companies with the
EDD, submitted false wage information for individuals whom he falsely
claimed worked for these companies, and then fraudulently applied for
and helped obtain UI and DI benefits in the names of these
individuals.

b. The fictitious companies were Amazing Events, Inc.,
and Paradise Weddings, Inc. (collectively “the fake companies”).
Neither of the fake companies ever conducted any business or employed
anyone. Defendant created and helped create the fake companies
solely to carry out the scheme and registered them with the
California Secretary of State to falsely make them appear to be
actual businesses.

om Defendant registered and helped others register the

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Case 2:19-cr-00605-JAK Document1 Filed 10/07/19 Page 3o0f5 Page ID#:3

fake companies with the EDD, listing addresses which he controlled or
to which he had access as the business addresses for the fake
companies.

d. Defendant obtained social security numbers (“SSNs”),
dates of birth (“DOBs”), and other identifying information for
individuals who defendant intended to identify as employees of the
fake companies and in whose names defendant intended to submit
fraudulent claims for UI and DI benefits to the EDD (collectively,
the “fake claimants”).

e, After registering the fake companies with the EDD and
obtaining SSNs and DOBs for the fake claimants, defendant submitted
Quarterly Contribution and Wage Adjustment Forms (EDD Forms DE-6 or-
DE-9C, or “wage reports”) to the EDD, falsely claiming that the fake
claimants had earned wages at the fake companies. Contrary to
defendant’s submissions to the EDD, none of the fake claimants ever
worked for the fake companies, and none ever received the wages that
defendant reported to the EDD. This information was material to the
EDD’s decision to authorize payment of the UI and DI benefits, and
defendant knew at the time that he submitted the information to the
EDD that it was false. In submitting this false information,
defendant acted with the intent to defraud the EDD.

f. Once the fraudulent wage reports were submitted to the
EDD, defendant filed and caused to be filed UI/DI benefits claims
with the EDD for the fake claimants. Through these filings,
defendant falsely stated that the fake claimants had been laid off
from the fake companies or had become disabled from their employment
with the fake companies, and that the fake claimants were entitled to
UI/DI benefits from the EDD. In submitting the fraudulent UI/DI

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Case 2:19-cr-00605-JAK Document1 Filed 10/07/19 Page 4of5 Page ID #:4

claim forms to the EDD, defendant falsely listed addresses that
defendant controlled or to which defendant had access as the home
addresses of the fake claimants, including 1607 E. Florence Avenue,
Los Angeles, California, 90001. In submitting the fraudulent UI/DI
claim forms, defendant acted with the intent to defraud the EDD.

g. As a result of defendant’s false submissions, the EDD
directed BOA to send by U.S. mail EDD debit cards to the fake
claimants at the addresses that defendant had listed for the fake
claimants on the fraudulent UI/DI claim forms. In submitting claims
for UI/DI benefits in the names of the fake claimants, defendant knew
that the EDD debit cards would be sent by mail.

h. After defendant received the EDD debit cards,
defendant would withdraw the fraudulent UI/DI benefit payments from
BOA accounts linked to the EDD debit cards.

i. In order to receive additional fraudulent UI/DI
benefits using the EDD debit cards, defendant submitted and caused to
be submitted to the EDD additional forms (EDD Forms DE-4581) in the
names of the fake claimants which claimed that the fake claimants
were still unemployed/disabled and entitled to continue to receive
UI/DI benefits.

4, In total, defendant submitted and caused to be submitted at
least 27 fraudulent claims to the EDD seeking $253,008 in UL/DI
benefits on behalf of at least 15 fake claimants.

Cc. USE OF THE MAILS

5. On or about November 24, 2014, within the Central District
of California and elsewhere, defendant, for the purpose of executing
and attempting to execute the above-described scheme to defraud,
willfully caused an EDD debit card carrying UI benefits in the amount

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Case 2:19-cr-00605-JAK Document1 Filed 10/07/19 Page5of5 Page ID #:5

of $450 in the name of P.H.,

a fake claimant, to be placed in an

authorized depository for mail matter to be sent and delivered by the

United States Postal Service according to the directions thereon,

that is,

1607 E. Florence Avenue,

Los Angeles, California, 90001.

NICOLA T. HANNA
United States Attorney

BRANDON D. FOX
Assistant United States Attorney
Chief, Criminal Division

RANEE A. KATZENSTEIN
Assistant United States Attorney
Chief, Major Frauds Section

MONICA BE. TAIT
Assistant United States Attorney
Deputy Chief, Major Frauds Section

VALERIE L. MAKAREWICZ
Assistant United States Attorney
Major Frauds Section


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