New Bedford Duo Scammed Pandemic Funds From Behind Bars

BOSTON – Arthur Pacheco, 47, formerly of New Bedford, Mass., received one year in federal prison and three years of supervised release today for his role in a brazen scheme to defraud the Pandemic Unemployment Assistance (PUA) program. The sentence, handed down by U.S. District Court Judge Indira Talwani, follows Pacheco’s July 22, 2021 guilty plea to two counts of wire fraud. His wife, Tiffany Pacheco, also pleaded guilty on August 30, 2021, and is slated to be sentenced January 12, 2022.

The scheme, cooked up while Arthur Pacheco was already incarcerated in Texas until September 4, 2020, highlights the vulnerabilities exploited during the chaotic rollout of COVID-19 relief funds. Tiffany Pacheco, shockingly, was hired by the Massachusetts Department of Unemployment Assistance (DUA) shortly after her own release from federal prison for aggravated identity theft. This put her in a prime position to manipulate the system, and she didn’t hesitate to do so.

According to court documents, the Pachecos initially submitted PUA claims reporting zero 2019 income and no dependents. But Tiffany Pacheco, leveraging her position at DUA, accessed the PUA system and drastically altered those claims. She inflated their 2019 income to over $240,000 and claimed seven dependents – all lies designed to maximize their payout. Critically, she bypassed required income verification, using her insider access to approve the fraudulent claims.

The deception didn’t stop there. Arthur Pacheco, while still behind bars, actively participated in the cover-up. He falsely told DUA investigators he hadn’t been incarcerated, claiming his time in prison was limited to just one month. Tiffany Pacheco backed up his lies, further attempting to conceal the truth from authorities. The couple’s greed was matched only by their audacity.

A search of their New Bedford apartment revealed a full-blown identity fraud operation. Investigators seized an ID laminator, 100 blank ID cards, 68 hologram overlays, 150 lamination sheets, and 649 blank checks. Approximately $17,000 in cash and a notebook filled with personal identifying information were also recovered, along with a driver’s license belonging to a victim used in another fraudulent PUA claim. DUA terminated Tiffany Pacheco’s employment on September 23, 2020, but the damage was already done.

The investigation was a collaborative effort led by Homeland Security Investigations’ Document and Benefit Fraud Task Force (DBFTF), alongside the U.S. Department of Labor’s Office of Inspector General, and supported by the New Bedford Police Department, Massachusetts Parole Board and the DUA’s Program Integrity Unit. Acting United States Attorney Nathaniel R. Mendell vowed continued vigilance against such schemes, emphasizing the Department of Justice’s commitment to prosecuting those who exploit public assistance programs for personal gain. Assistant U.S. Attorneys William Abely and Dustin Chao secured the convictions.

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