California Man Pleads Guilty in $46 Million Pandemic Fraud and Money Laundering Scheme

A California resident has pleaded guilty to participating in a large-scale fraud and money laundering scheme involving tens of millions of dollars in fraudulent unemployment benefits, with proceeds illegally funneled to China. The case marks another significant development in ongoing efforts to prosecute pandemic-related financial crimes.

Carlos A. Grijalva, 59, of Simi Valley, entered his plea in the U.S. District Court for the Middle District of Pennsylvania, admitting to one count of conspiracy to launder monetary instruments amounting to approximately $46.4 million. His guilty plea follows that of Bruce Jin, who admitted guilt in January 2025. Grijalva, Jin, and a third individual, Brian R. Cleland, were initially charged in August 2023, with additional charges filed in a superseding indictment this April.

From 2021 to early 2022, Grijalva and his co-conspirators laundered fraudulently obtained state unemployment compensation funds. They falsely portrayed their operations as legitimate businesses selling COVID-19 protective equipment while knowing the source of the funds was fraudulent. Grijalva acknowledged that identity theft victims’ bank accounts were accessed nationwide to process fraudulent claims, with perpetrators connected to China orchestrating much of the operation. State treasuries, including Pennsylvania’s, unknowingly issued tens of millions of dollars to these compromised accounts.

Further, Grijalva and Cleland transmitted stolen bank account information to payment processors to facilitate Automated Clearing House (ACH) payments into accounts they controlled. These details were supplied by an individual referred to as “COCONSPIRATOR 2” in the indictment, based in China. Over $30 million was subsequently transferred to entities controlled by Jin and other unidentified individuals abroad. Grijalva and Cleland personally profited by approximately $2.2 million each from the scheme.

As part of his plea deal, Grijalva agreed to forfeit about $46.4 million in U.S. currency, along with the contents of several bank accounts and real estate in Hawaii and California purchased with illicit funds. One California property was acquired under a family member’s name. Meanwhile, Jin remains in custody awaiting sentencing, and Cleland has pleaded not guilty and is set for trial.

The Federal Bureau of Investigation and the Department of Labor’s Office of Inspector General conducted the investigation. The prosecution team includes Assistant U.S. Attorneys Ravi Romel Sharma and K. Wesley Mishoe, along with Trial Attorney Patrick B. Gushue from the Department of Justice’s Money Laundering & Asset Recovery Section.

Article by multiple RFHC contributors, based upon information from the U.S. Attorney’s Office for the Middle District of Pennsylvania.

---