What You Need to Know About Unemployment Fraud
As struggling individuals look to their unemployment benefits for relief, scammers have quickly jumped on the opportunity to siphon millions by using unsuspecting identity theft victims–whether they’re unemployed or not.
While fraud and unemployment have always been around, the Covid-19 pandemic has left millions of Americans jobless, producing the highest unemployment rate since the Great Depression. As struggling individuals look to their unemployment benefits for relief, scammers have quickly jumped on the opportunity to siphon millions by using unsuspecting identity theft victims–whether they’re unemployed or not.
Scammers have seemingly found a perfect storm for financial fraud: overwhelmed state unemployment agencies who receive hundreds of thousands of applications each week and their outdated processing systems.
The worst part? If your identity has been stolen, you most likely won’t know until it’s too late. Here’s what you need to know to protect yourself and what you can do if you have fallen victim to unemployment fraud.
How will I know if my information was used to claim unemployment benefits?
You may also be notified by your employer about an application that has been submitted while you’re still employed. Or you may find yourself in need of unemployment benefits and may discover that someone has already made that claim for you and is collecting your funds.
What can I do to prevent this from happening to me?
Scammers have more access to personal information than ever before, utilizing various techniques like data breaches, email phishing schemes, social media accounts, cold-calling and more. Here are some ways to protect yourself:
- Be cautious of any phone calls, text messages, letters, websites or emails that are asking you to provide them with your personal information like social security numbers and birthdates. If you’re unsure, always check with the company or organization directly to see if the communication is genuine and secure.
- Familiarize yourself with the many ways scammers try to gain your information. Avoid opening emails and attachments from unknown senders.
- Monitor your bank accounts regularly and look for any unauthorized transactions.
- Request your free credit report. All three credit bureaus; Equifax, TransUnion and Experian are offering free weekly credit reports to help combat identity theft during the Covid-19 pandemic. Be sure to immediately report any fraudulent activity you find to the three major credit bureaus to have them place an alert on your records.
What do I do if my identity has been stolen to claim unemployment benefits?
If you’ve received a 1099-G for a fraudulent claim, you’ll need to report it to your employer and state unemployment agency. Be sure to keep a record of who you spoke to and any confirmation numbers.
Next, you’ll want to report the fraud to the Federal Trade Commission (FTC). The FTC should then assist in placing extended fraud alerts and credit freezes to your credit report which will help prevent scammers from opening new accounts in your name.