LOS ANGELES – A college football player was taken into custody this morning on federal charges alleging he orchestrated a scheme that fraudulently sought hundreds of thousands of dollars in COVID-related unemployment benefits.
Abdul-Malik McClain, 22, who currently attends school in Jackson, Mississippi, surrendered to federal law enforcement this morning in Los Angeles before being arraigned this afternoon in United States District Court.
A federal grand jury indictment returned on December 16 and unsealed this afternoon charges McClain with 10 counts of mail fraud and two counts of aggravated identity theft. McClain, who was residing in Los Angeles in 2020 during the alleged scheme, pleaded not guilty to the charges against him and was ordered released on a $20,000 bond.
According to the indictment, while a member of his university’s football team, McClain organized and assisted a group of other football players in filing fraudulent claims for unemployment benefits, including under the Pandemic Unemployment Assistance (PUA) program established by Congress in response to the pandemic’s economic fallout. The indictment alleges that the claims – which were filed with the California Employment Development Department (EDD), the administrator of the state’s unemployment insurance (UI) benefit program – contained false information about the football players’ supposed prior employment, pandemic-related job loss, and job-seeking efforts in California.
The indictment alleges that the false statements in the UI applications led EDD to authorize Bank of America to mail debit cards to the football players. Those debit cards were loaded with at least hundreds of dollars, and sometimes thousands of dollars, in unemployment benefits, which the recipients used to make cash withdrawals at ATMs and to fund personal expenses. In some cases, McClain sought and obtained a cut for helping others file fraudulent UI applications.
McClain and his co-schemers also allegedly filed applications in their own names, in the names of other friends and associates, and in the names of identity theft victims. According to the indictment, these claims also falsely stated that the claimants were self-employed workers, including athletic trainers and tutors, who had lost work in California as a result of the pandemic. These allegedly false claims also induced EDD to authorize Bank of America to issue debit cards in the names of the claimants. The indictment alleges that McClain and his co-schemers caused those cards to be mailed to addresses where they could collect the mail.
McClain allegedly caused at least three dozen fraudulent applications to be filed with EDD during the summer of 2020. According to the indictment, those fraudulent applications sought at least $903,688 in PUA benefits and led the EDD to pay out at least $227,736.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
During today’s arraignment, McClain was ordered to stand trial on February 15.
Each mail fraud count carries a statutory maximum sentence of 20 years in federal prison. The aggravated identity theft counts carry a two-year mandatory prison sentence consecutive to any sentence imposed on the mail fraud counts.
The FBI; the U.S. Department of Labor, Office of Inspector General; the Federal Deposit Insurance Corporation, Office of Inspector General; the U.S. Treasury Inspector General for Tax Administration; and the Social Security Administration, Office of Inspector General investigated this matter. The university, called “University 1” in the indictment, cooperated in this investigation.
Assistant United States Attorney Kerry L. Quinn of the Major Frauds Section is prosecuting this case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. More information on the Justice Department’s response to the pandemic may be found here.