Unemployment Fraud on the Rise

There has been widespread news addressing a growing problem with people using other’s social security numbers to fraudulently get unemployment benefits. Here is what you need to know to protect yourself.

From an article in Forbes magazine, these are the ways in which you may find out if your identity has been stolen.

• According to the FBI, many unemployment insurance victims do not know they have been affected until they file for unemployment insurance benefits—and some may not know until tax season rolls around.

• You might find out you’ve been scammed when you receive an IRS Form 1099-G, a tax form that reports your unemployment compensation for the year—despite never having made a claim.

• Or you may be notified by your employer that an unemployment claim has been filed while you’re still employed.

• Check your credit report

If you suspect you have been a victim, here are the steps you can take:

  1. Report Unemployment Insurance Fraud To Your Employer And State Unemployment Agency
  2. Make sure you keep a record of everything related to the fraud — emails and phone calls. Document date, time, person’s name and the discussion.
  3. File a complaint with the FTC online at identitytheft.gov or call 877-ID-THEFT.
  4. Contact The Three Major Credit Bureaus to freeze your credit report

Here are some steps companies can take to protect their employees:

• Employers must be diligent in reviewing their claim notices from their respective state unemployment claims office.

• Employers need to contest the claim and discuss any potential identity theft with their state unemployment office.

• Be sure your employee’s personal data is securely protected internally

• Make sure you are verifying social security numbers and IDs when hiring a new applicant

While the FTC estimates it [fraud] is affecting “tens of thousands of people” and an estimated $26 billion in payments may fall in the hands of fraudsters, there is hundreds of thousands of dollars being dedicated to these investigations. They will unfortunately take some time to resolve.

Production Machining: Beware of False Unemployment Claims Filed with Your Information

Forbes Magazine: Unemployment Benefits Fraud: What To Know And How To Protect Yourself

www.michigan.gov: Unemployment Insurance Agency Fact Sheet