Former EDD Employee Sentenced to Over Five Years for COVID-19 Unemployment Fraud

A former California Employment Development Department (EDD) worker has been sentenced to more than five years in federal prison after pulling off a massive COVID-19 unemployment fraud scheme. Gabriela Llerenas, 44, of Perris, California, illegally raked in nearly $4.3 million by taking advantage of the government’s pandemic relief programs.

Her sentencing marks another case in a long list of fraudsters who exploited financial aid meant for struggling Americans during one of the most challenging times in recent history.

How the Fraud Unfolded

When the pandemic shut down businesses in early 2020, the U.S. government responded with expanded unemployment benefits under the CARES Act. This included financial relief for people who were self-employed, gig workers, and independent contractors—groups that normally wouldn’t qualify for unemployment.

Llerenas saw an opportunity to cash in. Between April and October 2020, she submitted around 200 fraudulent unemployment claims, pretending that applicants were self-employed workers—many of them supposedly cake decorators or event attendants—who lost their income due to COVID-19.

In reality, many of these claimants either didn’t exist or didn’t qualify. Llerenas, who had experience as a tax preparer, used stolen personal information, including Social Security numbers, to get these claims approved. She also inflated incomes to maximize the payouts.

Abusing Her Knowledge of the System

Knowing how the system worked, Llerenas ensured that debit cards loaded with unemployment benefits were mailed to addresses under her control. These included her home, her husband’s business, her mother’s apartment, and even the homes of friends and family members.

She didn’t do this for free—she charged fees for filing applications and even demanded extra payments to “release” benefits, falsely claiming she still worked at EDD and had the power to approve claims.

Authorities say she sometimes submitted more than a dozen fraudulent claims in a single day, showing just how aggressively she exploited the system.

The Consequences: Prison Time and Restitution

Llerenas’s actions resulted in the loss of $4.3 million in taxpayer money. A federal judge sentenced her to 63 months in prison and ordered her to repay every penny she stole.

Federal agents also seized $621,124 in cash from her, money she could no longer use for her personal gain.

Not Her First Time Committing Fraud

Shockingly, this wasn’t Llerenas’s first run-in with the law.

She used to work at EDD as a disability insurance program representative but resigned in 2002 after admitting to fraudulently authorizing and paying disability benefits. That earlier crime landed her in prison for 37 months.

After serving her time, she was given a second chance. Instead of making an honest living, she went back to her old ways—only this time, the scheme was on a much larger scale.

Cracking Down on COVID-19 Relief Fraud

Llerenas’s case is just one of many involving fraudsters who took advantage of pandemic aid. The Department of Justice has ramped up efforts to crack down on COVID-19 relief fraud, establishing a task force to investigate and prosecute those who stole from government programs.

Authorities are urging the public to stay alert and report suspicious activities related to unemployment fraud.

A Harsh Lesson

Llerenas had already served prison time for fraud once, yet she chose to do it again—on an even larger scale. Her case serves as a clear warning: The government is serious about holding pandemic fraudsters accountable.

While COVID-19 relief programs were meant to help those in desperate need, criminals like Llerenas saw them as an easy payday. Now, instead of enjoying her stolen millions, she’s headed back to federal prison.