The U.S. has put billions of dollars into the unemployment system since the spring, an attraction for criminals that have led to growing theft and fraud attacks. This has led to at least $36 billion being taken from out-of-work Americans.
What We Know:
- As if things were not bad enough, now, the federal government and states are adding extra precautions. The $900 billion Covid relief package signed last month added steps for workers to confirm their eligibility for benefits.
- Most of the theft has centered on Pandemic Unemployment Assistance, a temporary program created by the federal CARES Act in March. It provides unemployment benefits to workers who don’t usually qualify, like the self-employed, gig workers, freelancers, contractors, and part-timers.
- Con artists are drawn to a possible massive payday, perhaps more than $10,000 or $20,000 per fraudulent claim, and the lax security measures initially put in place to rush money to Americans.
Protect yourself from Unemployment Fraud.
1. Never pay to apply for unemployment benefits.
2. Report benefits/payment cards you didn’t request.
3. Monitor your credit & check your credit reports.
4. Report suspected fraud: https://t.co/cA0cjCpDYGCC: https://t.co/1cmcFVw76I pic.twitter.com/MzU2H8pEjZ
— Texas Workforce Commission (@TXWorkforce) December 31, 2020
- By early November, at the very minimum, $36 billion of the $360 billion in CARES Act unemployment benefits was lost due to incorrect payments, principally from fraud, as stated by a conservative estimate from the Inspector General’s Office for the Department of Labor.
- “This is the largest fraud attack on the U.S. ever. Period” mentioned Blake Hall, founder and chief executive of ID.me, a company that provides an identity verifying service to more than a dozen state unemployment offices. “And it’s not even remotely close.” Fraudulent claims for benefits can make up for roughly 35% to 40% of new applications in some states with generous weekly payouts, Hall stated. He said international organized crime rings from countries like China, Ghana, Nigeria, and Russia account for most attacks.
- Their fraud can take many structures. Hall said the most common is identity theft, how criminals steal personal data to file a claim in someone else’s name. In some similar scams, attackers persuade victims to confirm their identity to get a job or win a prize.
“Not only are they evil thieves, but they’re also hurting people who need this money in their pocket right now, intensely,” Bill McCamley, who heads the state of New Mexico unemployment agency expressed of criminals.
However, some now fear the new terms to tighten security and protect against fraud could set back benefits to Americans who need them immediately.
