This blog series is dedicated to sharing real-world stories of identity fraud and theft — and just how devastating these crimes can be on organizations, individuals, and families. This post focuses on how fraudsters, emboldened by massive stimulus efforts from the government, have been filing unemployment claims using stolen identities — some of which were lifted years ago.
Real ID Theft Story: Fraudulent Unemployment Claims on the Rise
In mid-May 2020, Bryan from Washington State received a letter in the mail regarding unemployment benefits. Having been working steadily for more than 25 years, he threw the letter away, thinking it was junk mail. But his wife, who had seen recent news reports of unemployment fraud, told him about it, and he fished the letter out of his round file. Sure enough, it was from the State of Washington Employment Security Department, confirming that his recent request for unemployment benefits had been received. Someone had stolen Bryan’s Social Security number (SSN) and used it to file a fraudulent claim for unemployment benefits.
Washington, along with many other states including Massachusetts and Florida, has seen a recent wave of unemployment-related fraud, purportedly stemming from an organization with ties to Nigeria. A clear sign of these benefits being targeted by fraudsters, the Identity Theft Resource Center has received more complaints of unemployment identity theft in the first two weeks of May this year as they did in all of 2019. In just one county in Washington, more than 1,700 victims filed police reports online during the last five days in May; since then, authorities have recovered $300 million in bogus unemployment claims while also delaying benefits payments for hundreds of thousands of stressed job seekers.
The U.S. Secret Service first alerted states to the imposters’ multimillion-dollar fraud scheme and is investigating. In mid-June, the U.S. Attorney’s office for Massachusetts charged two Nigerian nationals, Nosayamen Iyalekhue and Esogie Osawaru, with wire fraud, allegedly bilking more than $400,000 from 11 different victims. Both men, who operated under aliases that included “Jude Ekanem” and “Milk Anthony,” plied a variety of COVID-19-related scams, including promoting stimulus-check fraud and peddling phony coronavirus remedies and at-home test kits.
Meanwhile, Bryan back in Washington has filed a police report, contacted his employer (and discovered several other coworkers have experienced the same ID theft), called the state unemployment office, filed a complaint with the Federal Trade Commission (FTC), and put a freeze on his credit.
Now he wonders where else he might find that his identity has been compromised. “It’s a sinking feeling,” Bryan said. “One of those things you never think will happen to you. Now all I can think of is, what next? Where else have they used my Social Security number? Do I need to worry about this for the rest of my life?”
How Unemployment Scams Work During COVID-19
The imposter scam, using stolen Personally Identifiable Information (PII) to apply for unemployment payments, is effective for two reasons. First, one of the CARES Act’s policy goals for getting unemployed workers an additional $600 a week in insurance benefits was speed, which relaxed normal verification protocols. It has become easier to accomplish unemployment scams since manual verification processes have been suspended during social distancing restrictions.
Another important reason cybercriminals have been able to pull off identity theft crimes is that they use personal data they likely stole or purchased from large-scale data breaches through the years. One major 2017 breach, Equifax, impacted nearly 150 million Americans, compromising their names, SSNs, birth dates, addresses, and, in some cases, driver’s license and credit card numbers. If you are concerned that your data may have been stolen as a result of this data breach, visit our frequently updated Equifax breach page.
5 Steps to Take If You Suspect Unemployment Benefits Fraud
If you do receive an unexpected letter from your state unemployment insurance office, detailing unemployment claims using your personal information (SSN, birth date, name, or address) that you have not made, you should follow these five steps to reduce your risk of additional fraud:
- Report the suspected fraud immediately with your state unemployment benefits agency. You will also want to notify your current and former employers for the past 18 months of the false unemployment filing, as it can potentially impact their unemployment insurance tax rates and raise issues of purposeful false filing that may create additional problems for you or your employment situation down the road.
- File a complaint with the FTC as soon as possible, providing details that can help government officials fight fraud as well as help you recover any personal losses.
- Also, file a non-emergency police report with local authorities so you have documentation of the suspected identity theft for future fraud claims, or to resolve questionable credit report findings with the major credit bureaus.
- Consider placing credit freezes with all three major consumer credit bureaus. While a credit freeze won’t stop the majority of identity theft from occurring, it can alert you to suspicious activity and is an important part of layered protection against identity crime.
- If you receive unemployment benefits you never applied for, ask your state agency for instructions. Never reply to any call, email, or text message instructing you to wire the money somewhere or put it on a gift card. Anyone who asks you to do that is a scammer.
Additionally, remember that scammers who have successfully applied and received unemployment money already have their victims’ birth date and SSN. They can do a lot of damage with those two data points: seek fraudulent food stamps, medical coverage, or other benefits.
If you have been victimized by unemployment-related identity theft, visit this FTC webpage to learn about further actions you can take. In addition, there are a number of identity theft protection solutions from IdentityForce that can help put your mind at ease.