He worked for the state in finance, now faces New York charges for unemployment fraud

New York authorities announced the arrest of a Troy man Wednesday, who they say claimed more than $17,000 in unemployment benefits even as he continued to work for the state’s Department of Taxation and Finance.

Johnny Neal was arraigned in an Albany County Court on charges of third-degree grand larceny, a class D felony, and violating secrecy provisions of the state tax law, a class A misdemeanor.

According to a release from New York Attorney General Letitia James, her office alleges that Neal started applying for unemployment benefits in September 2020.

He claimed his office was closed at that time due to the COVID-19 pandemic. However, he remained employed by DTF as a supervisor.

“By fraudulently collecting these benefits, Johnny Neal both cheated taxpayers and stole from those who rely on unemployment payments,” James said in a statement. “My office will ensure that anyone who commits fraud or violates the public’s trust will be held accountable to the full extent of the law.”

Besides allegedly claiming unemployment benefits, authorities also said that he used his position within the DTF to access confidential information for individuals, including family and friends, to help them prepare their tax returns. That information, James said, is only available for legitimate purposes to help the state collect taxes.

Under New York law, Neal faces up to seven years in prison if a jury finds him guilty of the grand larceny charge. He faces a year in jail or three years probation if found guilty of the tax law violation.

The attorney general’s office told The Center Square on Wednesday that Neal was no longer a state employee as of May 31.

Neal is the latest former state worker accused of committing unemployment fraud during the pandemic. In April, a federal grand jury indicted Wendell Giles, a former state Department of Labor employee, on charges he submitted and approved bogus claims.

Another former DOL worker, Carl J. DeVeglia, entered a guilty plea in April and acknowledged he helped defraud the state of more than $1.6 million, including $225,000 he pocketed.

According to federal court documents, Giles entered a not guilty plea, and his trial is scheduled to start in September.

“Stealing Unemployment Insurance benefits, especially during a public health crisis, is intolerable,” State Labor Commissioner Roberta Reardon said in a statement Wednesday. “If you break the law, you will be held accountable.”