White-Collar Benefits-Fraud Case Resolved Through Diversion

Being arrested for fraud can be overwhelming—especially for someone who has never been involved in the criminal justice system. Fraud allegations can threaten a person’s freedom, employment, professional licensing, immigration status, and reputation.

In this case, our client was accused of providing inaccurate information on applications for public benefits. Prosecutors alleged that the applications listed dependents and represented that our client had no other source of income or financial support.

Based on those statements, investigators claimed that our client received benefits to which they were not entitled. The investigation eventually resulted in an arrest and the filing of a criminal case.

California Benefits-Fraud Allegations

California Welfare and Institutions Code section 10980 addresses allegations that a person knowingly and intentionally made a false statement, concealed a material fact, or failed to disclose information to obtain or continue receiving public assistance.

The statute requires more than proof that an application contained incorrect information. The prosecution must establish that the person acted willfully and knowingly, with an intent to deceive, in order to obtain benefits or receive a greater amount of benefits than legally permitted.

Cases of this type frequently involve questions concerning:

• Whether the listed dependents actually qualified as members of the household
• Whether another adult lived in the home
• Whether the applicant received financial support from another person
• Whether income was earned, received, or available
• Whether the applicant understood the reporting requirements
• Whether any omission was intentional or simply a mistake
• How the government calculated the alleged overpayment

Looking Beyond the Allegations

An arrest does not establish guilt. Government-benefit applications can be complicated, and questions about household members, dependents, income, and financial support are not always as straightforward as investigators suggest.

The defense reviewed the applications, financial records, household circumstances, alleged loss amount, and our client’s personal history. We also presented mitigating information demonstrating why a traditional criminal conviction was unnecessary.

Rather than allowing the case to proceed toward a fraud conviction, we negotiated a resolution that permitted our client to participate in diversion.

The Result: Diversion Instead of a Fraud Conviction

The case was successfully placed into a diversion program. Diversion gave our client the opportunity to address the allegations without immediately suffering the consequences of a criminal conviction.

Upon successful completion of the court-ordered requirements, a diversion case may be dismissed. This type of resolution can be particularly important in a white-collar case, where even a misdemeanor fraud conviction may affect employment, licensing, immigration consequences, and future opportunities.

This result demonstrates that an arrest for benefits fraud does not necessarily have to end in a conviction. Careful analysis of the documents, the client’s intent, the alleged financial loss, and the available alternatives can make a significant difference.

If you have been contacted by an investigator or the district attorney regarding public-assistance or other benefits-fraud allegations, contact JOS Criminal Law before making a statement. What may seem like a simple explanation can later be used as evidence in a criminal case.

Every case is different, and past results do not guarantee a similar outcome.