First and foremost, you said your sister applied for nikkas that are locked up. One of the conditions to apply for unemployment is that you have to be available and able to work. Being in prison is the opposite of that.
You have to certify for benefits every week/every 2 weeks, and each week you have to certify that you(the claimant) were available and able to work. Your sister knew that these men were not available for work, therefore she knowingly defrauded the government, and that’s just one of the things that is going to sink her. She’s going to prison, my guy.
Most people are just going to have to pay the money back. But people like your sister are catching cases for sure.