Employment Security Worker Sentenced On Fraud, Bribery & Theft Charges

TACOMA, WA — A former Employment Security Department employee was sentenced Friday to five years in federal prison after prosecutors said he doled out hundreds of thousands in fraudulent unemployment funds and took kickbacks during the pandemic.

According to the U.S. Attorney's Office, Reyes De La Cruz III, 48, of Moses Lake, was hired as an intake agent in April 2020 as the ESD attempted to process a "crush of filings" while Washingtonians sought unemployment assistance in the early days of the pandemic. De La Cruz earlier worked for the same department from 1996 to 2003.

"Public servants must be held to [a] higher standard," said Richard A. Collodi, Special Agent in Charge of the FBI’s Seattle field office. "Mr. De La Cruz took advantage of a program meant to assist struggling families during the pandemic. He exploited his position to benefit himself, which makes his actions that much more appalling."

Prosecutors said De La Cruz used his access to the state database to provide fraudulent payouts to friends, family and acquaintances in exchange for bribes, distributing more than $360,000 in improper benefits and pocketing $21,000 in kickbacks.

"In many cases, the person did not qualify for benefits, but De La Cruz manipulated the claims database so that the claimants received lumpsum retroactive payments that sometimes amounted to tens of thousands of dollars," the U.S. Attorney's Office said Friday. "The claimants would then pay De La Cruz a portion of the lumpsum. The bribes ranged from $500-$6,500."

In instances where someone refused to pay a kickback, prosecutors said De La Cruz threatened to terminate their claims. In at least four instances, prosecutors said he filed claims using other people's information without their knowledge, with benefits paid out to debit cards mailed to a Moses Lake address.

During recorded phone calls and written correspondence with banks and the ESD, investigators said he also impersonated claimants and defrauded more than $100,000. De La Cruz was fired after his scheme was discovered, and his case was referred for criminal investigation.

A federal judge in Tacoma sentenced De La Cruz to five years in prison on federal wire fraud, bribery and aggregated identity theft charges.

"Reyes De La Cruz was a state employee who was trusted to handle sensitive employment information, He abused that trust for personal gain," said Quentin Heidenm, a special agent with the U.S. Department of Labor. "This sentencing sends a strong message to those who defrauded our nation’s unemployment system during a time when unemployment benefits were needed most."