State loses millions in fraudulent job claims | #employeefraud | #recruitment | #corporatesecurity


OLYMPIA, Wash. — Impostors have used the stolen information of tens of thousands of people in Washington to fraudulently receive hundreds of millions of dollars in unemployment benefits, the head of the state’s Employment Security Department said Thursday.

Commissioner Suzi LeVine said the state is working with federal law enforcement agencies, financial institutions and the U.S. Department of Labor to investigate the fraud and try to recover the money paid out during the huge spike in joblessness during the coronavirus crisis.

LeVine said she can’t release specific numbers or details of the investigation. But she said countermeasures taken by the state have “prevented hundreds of millions of additional dollars from going out to criminals and have prevented thousands of fraudulent claims being filed.”

LeVine said that in addition to other measures the agency has taken, it will continue to delay payments — a step it first took last week — to all applicants in order to take extra steps to verify claims. Previously, applicants set up for direct deposit received their money within 48 hours. Now, they will need to wait an additional two days.

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The New York Times and Seattle Times have previously reported that a U.S. Secret Service alert issued last week identified Washington as the top target so far of a Nigerian fraud ring seeking to commit large-scale fraud against state unemployment insurance programs.

LeVine said the Secret Service alert wasn’t directly shared with her, but that her agency received it through other sources. But LeVine said agency officials realized something was amiss even before that alert, once they started receiving communication from employers or employees who received information about unemployment benefits that the employee didn’t seek.

More than 1.1 million people in Washington have filed for unemployment benefits since businesses started closing in March because of the pandemic, but state officials said Thursday that they believe some portion of an increase in claims seen in the past week are from “impostor fraud” claims.

LeVine said previously that there have been no data breaches at the agency, and that recent fraud attempts are cases where someone’s personal information has been previously stolen from other sources — like during the 2017 Equifax breach — and is now being used to file for benefits.

“These are very sophisticated criminals who have pretty robust collections of information on people, and they are activating and monetizing that information,” she said.

More than 1.6 million claims for unemployment benefits — with some of that number reflecting people who filed multiple claims — were filed for the week of May 10-16, and more than $1 billion was paid last week to 565,764 individuals. To date, the state has paid out nearly $3.8 billion in benefits to more than 768,000 people, including federal money that is providing the unemployed with an additional $600 per week on top of the state’s weekly maximum benefit of $790 per week.

Levine noted that Washington’s state’s weekly maximum benefit — the second-highest in the nation — plus the additional federal money “does make us a more attractive target overall.”

Washington’s stay-at-home order — in place since March 23 — has been extended through at least May 31. The state’s unemployment rate jumped to a record 15.4% last month and the state’s economy lost 527,000 jobs last month.

LeVine said that a jump in new unemployment benefit claims last week point to additional fraud attempts across various industries.

Print Headline: State loses millions in fraudulent job claims

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