Originally published by Lori-Ann Craig.
Image by mohamed Hassan from Pixabay
In addition to turning the world upside down, COVID-19 has certainly created an environment conducive to scammers. Ranging from fake treatments and tests to undelivered goods, the early days of the pandemic provided scammers an opportunity to exploit people’s fears and uncertainty and their efforts to keep themselves and their families safe from this new virus. As the days of the pandemic continued to keep people indoors and in their virtual environments, the scams continued as well. Soon, we were reading about attempts to separate Americans from their economic stimulus checks and to take advantage of those who were desperately seeking appointments for vaccinations. Unemployment fraud, although not something new, has once again risen to the forefront.
Unemployment fraud can take many shapes. In some cases, an individual or an employer will file a false claim in his or her own name and knowingly collect benefits based on that false claim. This type of fraud is known as unemployment insurance fraud. However, there is a second type of unemployment fraud that is much more serious: unemployment identity theft. According to the U.S. Department of Labor, there has been a “surge in fraudulent unemployment claims filed by organized crime rings using stolen identities that were accessed or purchased from past data breaches.” The stolen identities are then used to file fraudulent claims, allowing the criminals to collect unemployment benefits, often from multiple states. In addition, this fraudulent activity can cause delays in the issuance and receipt of benefits for legitimate claimants. Since the beginning of the pandemic, Texas Workforce Commission, the state agency charged with administering unemployment benefits, has reportedly paid more than $691 million in suspected fraudulent unemployment claims. Although that figure represents only a small portion of claims, it is evidence of the widespread nature of this rising form of identity theft. In most cases of unemployment fraud, the victim does not become aware of the fraudulent claim or the related identity theft until they file a claim for benefits, they receive a notice from a governmental agency about an unemployment claim, they receive an IRS Form 1099-G, or they are notified by their employer while they are still employed.
So, what can you do to prevent the fraud from happening in the first place? Aside from keeping informed of the types of scams that exist and the methods scammers might use to perpetrate the fraud or by signing up for a fee-based identity protection service, there is not much that a victim can do to prevent the fraud. However, there are steps that the victim can take to mitigate the damage arising from the theft of their personal information:
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Report the unemployment identity fraud to the state where the theft occurred. In Texas, victims can report the fraud to the Texas Workforce Commission through its UI Fraud Submission portal at the following link: TWC Web Client – Forms – Texas Workforce Commission UI Fraud Submission (state.tx.us). Victims can also call the TWC Fraud Hotline at 800-252-3642 or send an email to TWC.fraud@twc.state.tx.us.
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Report the fraud to your employer.
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Notify one of the three credit reporting agencies of the fraud and have them issue a fraud alert.
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When filing your income tax, only include income that you received.
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Check your credit report weekly for any suspicious activity. You can do so for free by visiting AnnualCreditReport.com.
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Report the fraud to other governmental entities, such as the Federal Trade Commission through IdentityTheft.gov and the U.S. Department of Justice through its National Center for Disaster Fraud. Additionally, the IRS recommends that victims consider taking part in the IRS Identity Protection PIN Program that helps prevent thieves from filing federal tax returns in the victim’s name. In Texas, victims can also report the fraud to the Texas State Auditor’s Office by mail, email, or fax or though the use of its online web portal.
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Identity theft is a crime, so consider filing a report with local law enforcement authorities and the Texas Department of Public Safety.
Unfortunately, identity theft can occur without the victim’s knowledge and can create lots of headaches and problems for its victims. The best thing that one can do is be vigilant and know what to do if it happens to them.
Additional Reading
FBI Sees Spike in Fraudulent Unemployment Insurance Claims Filed Using Stolen Identities – Federal Bureau of Investigation
Is a Scammer Getting Unemployment Benefits in Your Name? – Federal Trade Commission
The Pandemic Created a “Perfect Storm” for Unemployment Fraud. How You Can Stay Protected – NextAdvisor in Partnership with TIME
Unemployment Fraud Claims – TexasLawHelp.org
Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.
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