Darren Smith, Unemployment Assistance Fraud, Michigan 2020

DETROIT – Darren Smith, 36, of Detroit, is facing serious time after pleading guilty today to a brazen scheme that saw him siphon off over $1.6 million in pandemic unemployment assistance. Smith didn’t just skim a little off the top; he allegedly filed roughly 250 fraudulent claims, exploiting the system designed to help those genuinely in need.

The scheme, which ran from May to at least July 2020, involved using the stolen identities of numerous victims. Smith allegedly submitted claims in their names, leveraging their Social Security numbers and personal information without consent. Once the fraudulently obtained benefits landed on debit cards, Smith reportedly hit ATMs across the Eastern District of Michigan, repeatedly withdrawing the stolen funds. It was a calculated, cold-hearted operation, authorities say.

“This case reflects our ongoing commitment to prosecute those who took advantage of the Covid-19 pandemic by stealing funds intended for those in need,” stated United States Attorney Dawn N. Ison. “We treat this kind of fraud especially seriously because corruption within these programs undermines trust and confidence in government programs generally. My office will remain vigilant in the pursuit of those who cheat the government and their fellow citizens.”

Federal investigators, including the U.S. Department of Labor Office of Inspector General and the U.S. Secret Service, pieced together the evidence, tracing the fraudulent claims and ATM withdrawals back to Smith. Irene Lindow, Special Agent-in-Charge of the DOL’s Great Lakes Region, emphasized the impact of such schemes: “Smith submitted false unemployment insurance claims in the names of identity theft victims to obtain debit cards loaded with stolen unemployment benefits. We will continue to work with our law enforcement partners to safeguard the unemployment insurance system from those who exploit these benefit programs.”

The U.S. Secret Service, often associated with protecting dignitaries, has increasingly focused on financial crimes like this. Special Agent in Charge John Marengo of the Detroit Field Office stated, “The U.S. Secret Service continues to work with our law enforcement partners on UIA Fraud schemes. We are thankful to the US Attorney’s Office and Department of Labor for partnering with us in the investigation and prosecution of this case.”

Smith now faces a statutory maximum of 20 years in prison on the wire fraud charge, and a mandatory minimum of 2 years on the aggravated identity theft charge. As part of a plea agreement, he’s also on the hook to repay the full $1,611,648 to the states he defrauded. Sentencing is scheduled for August 17, 2023, at 2pm. Assistant United States Attorneys Sarah Youngblood and Corinne M. Lambert are prosecuting the case.

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