BILL NUMBER: AB 500 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Solorio
FEBRUARY 15, 2011
An act to amend Sections 1263, 1595, 2113, 2117, 2117.5, 2118,
2118.5, 2122, and 3008 of the Unemployment Insurance Code, relating
to unemployment insurance, and making an appropriation therefor.
LEGISLATIVE COUNSEL'S DIGEST
AB 500, as introduced, Solorio. Unemployment Insurance Code:
penalties.
Existing law provides the forfeiture of, and ineligibility for,
unemployment insurance benefits for certain time periods for any
individual convicted in a court of competent jurisdiction of
willfully making a false statement or knowingly failing to disclose a
material fact to obtain or increase any benefit or payment in
violation of specified provisions of state law.
This bill would delete the requirement that the conviction be for
a specified violation of state law, and would instead require that
the conviction be in a court of competent jurisdiction of this state,
any other state, or the federal government.
Existing law prohibits a person from making false statements,
representations or concealment to obtain, increase, reduce, or defeat
unemployment benefit payments or for the purpose of lowering or
avoiding contributions under these provisions. Existing law requires
the department to give a person written notice of intent to file a
criminal complaint under these provisions not less than 10 days prior
to the filing of the criminal complaint.
This bill would delete this notice requirement.
Existing law provides that a violation of specified provisions of
the unemployment insurance law and the law requiring the withholding
of state income tax on wages is a crime, with specified and differing
penalties. Existing law provides that all penalties collected
relating to disability insurance are deposited in the Employment
Development Department Contingent Fund. Existing law also makes it a
crime to conspire to commit a crime, and makes conspiracy punishable
by specified fines and imprisonment.
This bill would make various changes regarding the penalties for
violations of the unemployment insurance law, the law requiring the
withholding of state income tax on wages, and the Unemployment
Insurance Code, including increasing specified civil penalties,
making certain violations a felony rather than a misdemeanor, and
increasing the maximum imprisonment for various violations. The bill
would provide that conspiracy to violate the unemployment insurance
laws is subject to the same fines and imprisonment as the violation
of those laws, rather than the general fines and imprisonment
applicable to conspiracy to violate the law. The bill would require
the Employment Development Department to deposit repayments under the
unemployment insurance provisions into the funds from which the
overpayments were made, to deposit penalties for violations of
unemployment compensation benefit provisions into the Employment
Development Department Benefit Audit Fund, and to deposit penalties
for violations of disability compensation benefit provisions into the
Unemployment Compensation Disability Fund.
This bill would make an appropriation by providing for the deposit
of new and increased penalties into the Unemployment Compensation
Disability Fund and the Employment Development Department Benefit
Audit Fund, both of which are continuously appropriated funds.
Vote: 2/3. Appropriation: yes. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1263 of the Unemployment Insurance Code is
amended to read:
1263. (a) Any individual convicted under Section 2101
by any court of competent jurisdiction of this state,
any other state, or the federal government, of willfully making
a false statement or knowingly failing to disclose a material fact
to obtain or increase any benefit or payment under this division
shall forfeit any rights to benefits for the week in which the
criminal complaint was filed and for the 51 consecutive calendar
weeks which immediately follow that week, irrespective of a
subsequent order under the provisions of Section 1203.4 of the Penal
Code allowing the individual to withdraw his or her plea of guilty
and to enter a plea of not guilty, or setting aside the verdict of
guilty or dismissing the criminal complaint, but a forfeiture of
benefits under this subdivision shall extend no later than the
effective date of any order under Section 1203.4 of the Penal Code,
and, if the period of forfeiture has not previously expired, the
forfeiture of benefits under this subdivision shall terminate as of
the effective date of any such order.
(b) Any individual convicted under Section 2101
by any court of competent jurisdiction of this state, any other
state, or the federal government, of willfully making a false
statement or knowingly failing to disclose a material fact to obtain
or increase any benefit or payment under this part, Part 3
(commencing with Section 3501), or Part 4 (commencing with Section
4001) shall, irrespective of a subsequent order under the provisions
of Section 1203.4 of the Penal Code allowing the individual to
withdraw his or her plea of guilty and to enter a plea of not guilty,
or setting aside the verdict of guilty or dismissing the criminal
complaint, be ineligible to receive unemployment compensation or
extended duration benefits or federal-state extended benefits for the
week in which the criminal complaint was filed, or any subsequent
week, for which he or she is first otherwise in all respects eligible
for unemployment compensation or extended duration benefits or
federal-state extended benefits and for 14 subsequent weeks for which
he or she is otherwise in all respects eligible for unemployment
compensation or extended duration benefits or federal-state extended
benefits. No disqualification under this subdivision shall be applied
to any week if all or any portion of the week is beyond the
three-year period next succeeding the date of the filing of the
criminal complaint.
(c) The department shall, effective upon the date of the filing of
a criminal complaint against an individual prosecuted under
Section 2101 for the crimes described in subdivision
(a) , suspend the payment of benefits to the individual.
(d) A plea or verdict of guilty, or a conviction following a plea
of nolo contendere, is deemed to be a conviction within the meaning
of this section irrespective of whether an order granting probation
or other order is made suspending the imposition of the sentence or
whether sentence is imposed but execution thereof is suspended.
(e) Notwithstanding the provisions of this section, an individual
may during a period of forfeiture under subdivision (a) of this
section meet the conditions to remove any disqualification that is
imposed under Sections 1260 or 1261, or subdivision (b) of this
section, but no week during the period of forfeiture shall be used to
offset the amount of any overpayment.
SEC. 2. Section 1595 of the Unemployment Insurance Code is amended
to read:
1595. There is in the State Treasury a special fund known as the
Employment Development Department Benefit Audit Fund. There shall be
deposited in, or transferred to, this fund all sums collected
pursuant to Section 1375.1 and subdivision (d) of Section 2122
and all interest from these sums.
SEC. 3. Section 2113 of the Unemployment Insurance Code is amended
to read:
2113. Nothing in this division shall prevent the department from
accepting restitution or an acceptable arrangement for restitution,
made voluntarily before the department files a criminal complaint
under Section 2101 or 2102, for overpayment of benefits from any
person, who has not previously claimed any right under this section,
who has not been convicted of an offense under Section 2101 or 2102
within three years preceding the service under this section of a
written notice of intent to file a criminal complaint and who has
willfully made a false statement or representation or knowingly
failed to disclose a material fact to obtain or increase any benefit
under any provision of this division. The department shall by
mail or personal service give the person written notice of intent to
file a criminal complaint under Section 2101 or 2102 not less than
10 days prior to the filing of the criminal complaint. The
department may accept restitution or an arrangement for restitution
and any such acceptance shall be in lieu of any criminal action
against the person, except that the department shall not be precluded
from filing a criminal action against any person who defaults under
an arrangement for restitution which it has accepted. For purposes of
this section, no period of time during which an arrangement for
restitution is in effect shall be a part of any limitation of the
time for commencing a criminal action. The department shall deposit
amounts received from any person under this section in the fund from
which the overpayments were made.
SEC. 4. Section 2117 of the Unemployment Insurance Code is amended
to read:
2117. Any person who, with or without intent to evade any
requirement of this code or any lawful requirement of the department
under this code, fails to file any return or report, or to supply any
information required by this code or who, with or without like
intent, makes, renders, signs, or verifies any false or fraudulent
return, report, or statement, or supplies any false or fraudulent
information, is liable for a civil penalty of not more than
one twenty-five thousand dollars
($1,000) ($25,000) , and is also guilty of a
misdemeanor felony and shall, upon
conviction, be fined an amount not to exceed one
twenty-five thousand dollars ($1,000)
($25,000) , or be imprisoned for not more than
one year five years , or both the fine and
imprisonment, at the discretion of the court.
SEC. 5. Section 2117.5 of the Unemployment Insurance Code is
amended to read:
2117.5. Any person who, within the time required by this code,
willfully fails to file any return or report, or to supply any
information with intent to evade any tax imposed by this code, or
who, willfully and with like intent, makes, renders, signs, or
verifies any false or fraudulent return, report, or statement or
supplies any false or fraudulent information, is punishable by
imprisonment in the county jail not to exceed one year
five years , or in the state prison, or by a
fine of not more than twenty fifty
thousand dollars ($20,000) ($50,000) ,
or by both the fine and imprisonment, at the discretion of the court.
SEC. 6. Section 2118 of the Unemployment Insurance Code is amended
to read:
2118. Any person or employer who, with or without intent to
evade, fails to withhold, pursuant to Section 13020, or fails to pay
over any tax withheld, is guilty of a misdeameanor
felony and, upon conviction, shall be fined an amount not
to exceed one fifty thousand dollars
($1,000) ($50,000) , or imprisoned for
not more than one year five years , or
both the fine and imprisonment, at the discretion of the court.
SEC. 7. Section 2118.5 of the Unemployment Insurance Code is
amended to read:
2118.5. Any person required by this code to collect, account for,
and pay over any tax or amount required to be withheld who willfully
fails to collect or truthfully account for and pay over the tax or
amount shall, in addition to other penalties provided by law, be
guilty of a felony and, upon conviction thereof, shall be fined an
amount not more than twenty fifty
thousand dollars ($20,000) ($50,000) ,
or imprisoned in the state prison, or both the fine and imprisonment,
at the discretion of the court.
SEC. 8. Section 2122 of the Unemployment Insurance Code is amended
to read:
2122. (a) Except as provided in Sections
2117, 2117.5, 2118, and 2118.5, a violation of this chapter is
punishable by imprisonment in the county jail or in the state
prison not to exceed one year two years
, or in the state prison, or by a fine of
not more than twenty forty thousand
dollars ($20,000) ($40,000) , or by
both the fine and imprisonment, at the discretion of the court.
(b) Notwithstanding the penalties set forth in Section 182 of the
Penal Code, any person convicted under Section 182 of the Penal Code
for conspiring to violate this chapter shall be subject to penalties
and imprisonment as set forth in subdivision (a).
(c) The department shall deposit amounts received as repayment
from any person for a violation of this chapter punishable under this
section into the fund from which the overpayments were made.
(d) The department shall deposit amounts received as penalties for
violations of this chapter relating to unemployment compensation
benefits into the Employment Development Department Benefit Audit
Fund.
(e) The department shall deposit amounts received as penalties for
violations of this chapter related to disability compensation
benefits into the Unemployment Compensation Disability Fund.
SEC. 9. Section 3008 of the Unemployment Insurance Code is amended
to read:
3008. All money collected under Section 984 and subdivision
(e) of Section 2122 shall be deposited in the Unemployment
Compensation Disability Fund.