WHY ARE FRAUDULENT UNEMPLOYMENT CLAIMS RISING?
Criminals are taking advantage of today’s high unemployment rate and hoping to slip fraudulent unemployment claims past overwhelmed state workers. With the high number of claims, it is also likely that fraud investigations will take longer, and criminals can cash in on profits in the interim. This year has been particularly difficult since the federal Pandemic Unemployment Assistance program for the self-employed bypassed some of the standard safeguards such as verification using previous employers.
Many people find fraudulent unemployment claims particularly upsetting since it requires a Social Security Number (SSN). If you are under the impression that your SSN is secure information, sadly, it is not. After the myriad high-profile data breaches, especially the 2017 Equifax breach, there are millions of SSNs available for sale on the dark web for as little as $4.
While states are trying to tighten identity verification standards, it is a struggle to balance adopting enhanced security measures without causing significant verification delays that impact legitimate claims from workers who have lost their jobs and need funds quickly.
WHAT SHOULD I DO ABOUT SUSPECTED UNEMPLOYMENT FRAUD?
There has been a spike in fraudulent unemployment insurance claims complaints related to the ongoing COVID-19 pandemic involving the use of stolen personally identifiable information (PII).
U.S. citizens from several states have been victimized by criminal actors impersonating the victims and using the victims’ stolen identities to submit fraudulent unemployment insurance claims online. The criminals obtain the stolen identity using a variety of techniques, including the online purchase of stolen PII, previous data breaches, computer intrusions, cold-calling victims while using impersonation scams, email phishing schemes, physical theft of data from individuals or third parties, and from public websites and social media accounts, among other methods. Criminal actors will use third parties or persuade individuals who are victims of other scams or frauds to transfer fraudulent funds to accounts controlled by criminals.
Many victims of identity theft related to unemployment insurance claims do not know they have been targeted until they try to file a claim for unemployment insurance benefits, receive a notification from the state unemployment insurance agency, receive an IRS Form 1099-G showing the benefits collected from unemployment insurance, or get notified by their employer that a claim has been filed while the victim is still employed.
Be on the lookout for the following suspicious activities:
Receiving communications regarding unemployment insurance forms when you have not applied for unemployment benefits
Unauthorized transactions on your bank or credit card statements related to unemployment benefits
Any fees involved in filing or qualifying for unemployment insurance
Unsolicited inquires related to unemployment benefits
Fictitious websites and social media pages mimicking those of government agencies
Tips on how to protect yourself:
Be wary of telephone calls and text messages, letters, websites, or emails that require you to provide your personal information or other sensitive information, especially birth dates and Social Security numbers. Be cautious with attachments and embedded links within email, especially from an unknown email sender.
Make yourself aware of methods fraudsters are using to obtain PII and how to combat them by following security tips issued by the Cybersecurity and Infrastructure Security Agency, including:
o Avoiding Social Engineering and Phishing Attacks
o Protecting Against Malicious Code
o Preventing and Responding to Identity Theft
Monitor your bank accounts on a regular basis and request your credit report at least once a year to look for any fraudulent activity. If you believe you are a victim, review your credit report more frequently.
Immediately report unauthorized transactions to your financial institution or credit card provider.
If you suspect you are a victim, immediately contact the three major credit bureaus to place a fraud alert on your credit records. Additionally, notify the Internal Revenue Service by filing an Identity Theft Affidavit (IRS Form 14039) through irs.gov or identitytheft.gov.
WHAT EMPLOYERS CAN DO (VIA UCM Specialists)
Respond timely to UCM claim requests and denote suspected fraud claims so we can respond to the state agency
UCM will monitor your tax account for fraudulent charges
UCM is working with state agencies regarding any of our clients experiencing fraud claims
UCM will assist with any client’s employees who may be experiencing fraud
AP News: Data Breach Compromised Info of 1M-Plus Who Sought Benefits
Government Technology: Unemployment Benefits Claims Fraud: New Threats for 2021