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Fraudulent Unemployment Claims Swamp Illinois

There have been more than 212,000 fraudulent jobless benefits claims in the state since March 1, raising concerns about how scammers are getting personal information from so many residents.

(TNS) — Micro Tech Systems, which employs just a handful of workers, hasn’t laid off anyone since the start of the coronavirus pandemic.

So Mark Goldman, owner of the Northbrook-based computer repair firm, was surprised when he received a letter from the state saying one of his employees was laid off and had applied for unemployment benefits.

He was even more surprised to read he was the laid off employee.

Goldman soon realized he was a victim of unemployment fraud, in which an impostor filed a claim to attempt to receive benefits using his personal information. “Apparently I fired myself and I didn’t even know it,” Goldman, 40, said. The same thing happened to Brian Dolan, 63, president of Ambulance Transportation, which operates ATI Ambulance, Trace Ambulance and Vandenberg Ambulance in Chicago.

He received a letter from the state’s unemployment agency saying a claim had been submitted in his name, but he had not filed one. Someone appeared to be using his information to illegally obtain benefits.

“Do they have my Social Security (number)? I don’t know. But how did they get my wage information?” Dolan said.

Fraudulent claims for unemployment benefits are on the rise as record numbers of Illinois residents file for benefits during the COVID-19 pandemic, causing victims like Goldman and Dolan to worry their personal information has been exposed.

More than 212,000 fraudulent claims for unemployment benefits have been filed with the state since March 1, according to the Illinois Department of Employment Security. Of those, 169,506 were filed under a federal program created through the federal coronavirus relief package that extended benefits to self-employed and gig workers. The other 42,496 fraudulent claims were filed under the system for regular state benefits.

In cases that involve identity theft, some victims discover the fraud when they receive a letter from the state unemployment agency saying a claim has been filed in their name, or their employer receives a letter. People who have received these letters but have not filed for unemployment should immediately call the agency at 800-814-0513 to flag the case as fraudulent.

The letters include debit cards, which the state sends out to people once they file for benefits. The cards are not pre-loaded with funds, but the state sends the cards in case people want to have their benefits loaded onto the card rather than deposited into their bank accounts, agency spokeswoman Rebecca Cisco said.

Scammers are able to obtain the funds by directing the state to send benefits to their own accounts, rather than to the debit cards sent to the victim’s home.

The state has been able to catch most but not all of these fraudulent claims before impostors are able to receive benefits, Cisco said.

Kristin Richards, acting director of the Illinois Department of Employment Security, said at a Monday news conference the agency is working to quantify the amount of fraudulent claims that have been paid out. Illinois has paid out more than $17.7 billion in unemployment benefits to more than 1.3 million people from March 1 through the end of October, according to the agency.

Anyone who has been a victim of fraud is not liable for unemployment benefits paid in their name, she said.

Illinois Attorney General Kwame Raoul said his office has received more than 4,000 calls on unemployment insurance fraud.

“Anyone can be targeted. I myself received a phony debit card,” Raoul said.

Experts say fraudsters typically file claims using personal data leaked from past data breaches like the 2017 Equifax breach, which exposed the Social Security numbers, birth dates and home addresses of up to 143 million Americans.

The state’s system for processing unemployment benefits has been inundated with an unprecedented number of claims at the same time the agency implemented the federal Pandemic Unemployment Assistance program for the self-employed.

The federal program was vulnerable because typical safeguards the agency uses to weed out fraudulent claims, like sending letters to employers, wasn’t possible with self-employed workers, according to the state.

The sense of urgency to get those funds to millions of unemployed Americans gave fraudsters the perfect opportunity to strike, said Nik Theodore, a professor and labor market researcher at the University of Illinois at Chicago who has studied the unemployment benefits system in Illinois.

“When you look at this whole package you really wind up with an operating environment that is primed for fraud and abuse on a large scale,” Theodore said.

Theodore said he also received a letter from the state notifying him he applied for benefits.

“Unfortunately, you can only be reactive and try to protect your data,” he said.

Victims should consider putting a freeze on their credit report from the three main credit agencies in order to protect their identities, Theodore said. The state recommends victims not activate the debit card and check their credit report for possible suspicious activity.

(c)2020 the Chicago Tribune. Distributed by Tribune Content Agency, LLC.

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