Three people have pleaded guilty in Santa Barbara County to multiple counts of felony unemployment benefit fraud and identity theft, in just one example of the type of fraud that has cost the state tens of billions of dollars during the pandemic.

The three defendants were Gordon Alan Welterlen and Nicole Michelle Milan, of San Diego, and Rosa Maria Bradley of Santa Barbara, according to a Jan. 22 statement from Santa Barbara County District Attorney Joyce Dudley. They admitted to filing fraudulent claims worth $2 million and will be sentenced on March 19 in Santa Barbara Superior Court.

Welterlen pleaded guilty to 15 felony counts of unemployment insurance benefit fraud, one felony count of conspiracy to commit multiple-identity theft and one count of unauthorized access and taking data from a computer system. He also admitted a special allegation of taking more than $500,000, and as result of his plea, will be sentenced to 18 years in state prison.

Milan pled guilty to 15 counts of unemployment insurance benefit fraud and one felony count of conspiracy to commit multiple-identity theft. Milan also admitted to a special allegation of taking more than $500,000 and as a result of her plea, will be sentenced to 15 years in state prison, Dudley’s office said.

Bradley pleaded guilty to one felony count of unemployment insurance benefit fraud and one felony count of conspiracy to commit multiple-identity theft. Because of her plea, Bradley will get two years of probation.

“Identity theft can cause significant and long lasting financial and emotional harm to a victim,” Dudley said in a news release. “It often takes years for the victim fully recover.”

As part of the plea agreement, Welterlen admitted he illegally accessed computer networks belonging to businesses throughout Santa Barbara County, including Wolfe & Associates Property Management of Santa Barbara. Through that network, Welterlen stole the identities of more than 9,000 people, and he and his co-defendants used the stolen identities to file fraudulent unemployment benefits claims with the California Employment Development Department.

Welterlen and Milan filed more than 300 such claims, which cost the state more than $2 million. Bradley admitted to conspiring with her co-defendants to file false claims for benefits and to receiving money from the fraudulently filed claims.

In addition to filing fraudulent unemployment claims, Welterlen and Milan admitted to using the stolen identities to purchase and lease cars, open multiple bank accounts and rent apartments. Prosecutors filed charges against them in August.

The guilty pleas came just days before the state of California announced that at least 10% and possibly up to 27% of unemployment benefits paid during the pandemic have been fraudulent. In 2019, about 6% of unemployment benefits were fraudulent, the Employment Development Department said.

The department processed almost 20 million claims and paid more than $110 billion in benefits between March 2020 and Jan. 16, 2021. Fraud accounted for between $11 billion and $30 billion of those payments.

Much of the fraud came in the new, federally funded Pandemic Unemployment Assistance Program, which allowed self-employed people to file for benefits if they had reduced income. It did not require income verification and allowed applicants to back-date their claims.

“EDD was clearly under-prepared for the type and magnitude of criminal attacks and the sheer quantity of claims,” EDD Director Rita Saenz said in a news release disclosing the extent of the fraud. “We are focused on making the changes necessary to provide benefits to eligible Californians as quickly as possible and stopping fraud before it enters the system.”