Eighteen people, including several city employees, were charged Thursday in a broad scheme to defraud the state’s COVID-19 era pandemic unemployment benefits system, which investigators only learned of following an intertwined ghost gun bust.
Manhattan District Attorney Alvin Bragg said that the discovery of two people illegally manufacturing ghost guns, both employees of the Department of Homeless Services (DHS), led investigators to the sprawling alleged scheme among public employees to defraud the state of pandemic unemployment benefits.
One by one, the suspects were marched into Manhattan Criminal Court on Thursday to face arraignment on various charges connected to the scheme.
“This is just great, old-fashioned, law enforcement work where you start pulling at threads, you bring a great case, and you don’t stop there,” Bragg said. “You don’t stop because you just charged the one crime, you keep pulling at the threads to see what are the other harms to the public”
The co-conspirators, several of them also DHS employees, allegedly stole personal identifying information from dozens of homeless individuals living in city-run shelters and used it to apply for unemployment benefits. Bragg alleged the defendants had filed 170 bogus unemployment applications and netted $1.2 million in ill-gotten gains.
The rogue DHS employees, which included the two alleged ghost gun manufacturers, allegedly shared the personal identifying info with various others, who purportedly included several other city employees. Bragg said the defendants include those working for DHS, the NYPD, the MTA, NYCHA, and the US Postal Service.
“Many of the defendants worked in government positions of trust,” said Bragg. “This type of conduct by our public servants is unacceptable and, as we allege, criminal.”
Initially, Bragg said, the defendants would file for benefits using their own addresses, but eventually started filing using addresses on a specific Upper East Side mail route. That allowed them to enlist a mail carrier who would intercept mail from the Department of Labor and help distribute the ill-gotten gains.
One defendant in particular, Charde Baker, felt that another co-conspirator — later one of the alleged ghost gun manufacturers — was taking more than their fair share of the proceeds, and is alleged to have orchestrated a burglary at that co-conspirator’s home in November of 2020. She later was hired by the NYPD as a school safety agent, but was fired when the Police Department learned about the burglary.
The investigation grew out of a smaller-scale one involving DHS employees buying materials online to 3D print ghost guns at home. Bragg did not immediately divulge how the larger investigation grew out of that, but said “when you bring a serious charge like those ghost gun charges, you begin to then look into the background of the individuals involved.”
As an example, he said “investigative steps” like a search warrant could yield information on more wide-ranging schemes.
“We’re seeing more and more in our practice, time and time again, street crime and white collar crime intertwine,” he said. “Whether that is violent robberies followed by identity theft, illegal gun sales accompanied by financial fraud, or cryptocurrency linked to terrorism. So today is one of those matters.”
