Former Sen. Dean Tran’s legal troubles expanded Friday when he was arrested and charged in federal court for allegedly collecting fraudulent unemployment benefits and failing to disclose income to the IRS.
Federal prosecutors announced a 28-count indictment against the Fitchburg resident alleging that after he departed the Massachusetts Senate in 2021, he collected $30,120 in pandemic unemployment benefits while also working as a paid consultant for a New Hampshire automotive parts company.
Acting U.S. Attorney Joshua Levy’s office also alleged that Tran, 48, failed to disclose more than $50,000 he earned from consulting for the company — which prosecutors did not identify — on his 2021 federal tax return as well as rental income he collected from tenants of a Fitchburg property.
“Dean Tran was once elected to serve taxpayers, but today we arrested him for allegedly cheating them out of tens of thousands of dollars in fraudulent unemployment benefits that were meant to be a lifeline for those struggling for survival as a result of the pandemic,” Jodi Cohen, Special Agent in Charge of the FBI Boston Division, said in a statement. “This former state senator allegedly made the conscious decision to repeatedly lie about his employment status and underreport his rental property income so he could get a tax break. The FBI and our partners are working hard every day to shut down such fraud schemes and protect the public from being fleeced.”
An attorney who previously represented Tran did not immediately return a call Friday morning seeking a response to the latest indictment.
Tran, who in September was indicted by a Suffolk County grand jury on two counts of violating state ethics laws and in 2022 was indicted on charges related to the theft of a firearm from an elderly woman, now also faces 25 counts of wire fraud and three counts of filing false tax returns in a federal case, according to Levy’s office. He is due to appear in federal court in Boston at 1:30 p.m., officials said.
Federal prosecutors allege in the indictment that Tran submitted an online application for state unemployment insurance benefits on Jan. 6, 2021 — the day after his Senate tenure ended — but that his application was denied by the state because legislators are not eligible for the benefits under state law.
He accepted a consulting position with the automotive parts company on March 14, 2021, and the very next day applied for unemployment benefits through the Pandemic Unemployment Assistance (PUA) program retroactive to Jan. 9, 2021, allegedly checking a box “stating that he was unemployed, partially unemployed or unable or unavailable to work.” His application was accepted March 16, 2021.
In April, the Massachusetts Division of Unemployment Assistance denied Tran’s PUA claim due to an issue related to “employment substantiation” and stopped PUA payments to him. Tran appealed the decision and submitted what the feds called a “sham employment offer letter” backdated to December 29, 2020, purporting to be from the CEO of a New Hampshire-based company that produces and distributes Asian foods. The letter allegedly offered Tran a job and a $120,000 annual salary.
During an appeal hearing in May 2021, Tran allegedly made misleading statements and concealed the fact that he had been working for and being paid by the auto parts company. In June 2021, the state reversed its decision and declared Tran eligible for PUA benefits “beginning the week ending January 2, 2021, and indefinitely thereafter, if otherwise eligible.”
His PUA benefits were terminated after the week ending Sept. 4, 2021 and Tran became a W-2 employee of the auto parts company on Sept. 20, 2021, according to the indictment.
“If TRAN had become a W-2 employee of the Automotive Parts Company prior to September 2021, however, TRAN’s wages would have been reported to the state and, thus, the DUA would have disqualified TRAN from receiving PUA benefits. By remaining as a consultant for the Automotive Parts Company until early September 2021, TRAN was able to conceal his employment from the DUA while he simultaneously collected both pay from the Automotive Parts Company and PUA benefits,” the indictment says.
From March through December 2021, the feds allege, Tran collected $43,925 in PUA benefits while also being paid $82,602 by the auto parts company.
The feds also alleged Friday that Tran reported $14,100 in gross rental income on his 2020 tax return, but actually collected $27,544 in rental income that year. In 2021, prosecutors allege, he deposited $30,855 worth of rent payments into a bank account of his but reported only $15,600 in gross rental income. And in 2022, the indictment claims, Tran took in $31,200 from his rental properties but reported just $15,600 in gross rental income. He also allegedly did not report any of the $54,720 in income that he earned as a consultant for the auto parts company in 2021.
The federal charges unveiled Friday add to Tran’s legal troubles. He was indicted by then-Attorney General Maura Healey in July 2022 on charges that he stole a Colt .45 gun from an elderly constituent and then misled the investigation into the incident. And in September, Attorney General Andrea Campbell announced that Tran had been indicted for allegedly using “members of his Senate staff to campaign for him while those staff members were on state time, state payroll, and purportedly working for the Legislature” during campaigns in 2018 and 2020.
The Massachusetts Senate sanctioned Tran in 2020 after the Senate Ethics Committee found his office staff had been performing campaign work with public resources during business hours. He denied the charges. He was removed from his position as assistant minority whip and banned from interacting with his staff except through official emails.
Tran narrowly lost his 2020 reelection bid to Sen. John Cronin, a Democrat. Last year, he ran for Congress against U.S. Rep. Lori Trahan and garnered more than 88,500 votes in his loss.
(Copyright (c) 2023 State House News Service.