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Legitimate Unemployment Claims Are Stalled or Lost in Colorado

The state’s Labor and Employment Department moved its fraud detection tools to the “highest possible level” in the spring to prevent further fraud. However, the effort has caused significant slowdowns for legitimate claims.

Michelle Kettleborough, pictured at home in Denver with her dogs Sachi, left, and Zuni
Michelle Kettleborough, pictured at home in Denver with her dogs Sachi, left, and Zuni, center, lost her job in June and has been waiting for months to receive unemployment from the state.
(Photo by Helen H. Richardson/The Denver Post)
Colorado’s attempt to prevent fraud in its unemployment system is having an unintended consequence: preventing thousands of legitimate claims from being paid.

At the beginning of the COVID-19 pandemic in early 2020 when Colorado unemployment skyrocketed to 11.3 percent from a historic low of 2.5 percent, the Department of Labor and Employment’s system at times was overwhelmed. It even crashed on a day when 21,000 people filed for benefits.

This time, Coloradans can usually file their claims, but they are facing difficulties getting paid — if they’re paid at all — and reaching real people to talk about their situations is proving to be a Herculean task for some.

After more than five years working for CPCneutek, a commercial printer in Grand Junction, 68-year-old Ilene Harsip lost her job.

She filed an unemployment claim in June. So far, three months have passed without a payment.

Harsip learned that her identity was stolen in early 2021. As she tries to rectify her situation and collect her benefits, Harsip’s found that it’s “nearly impossible to call for information,” she said.

Now, she’s paying 7-8 percent interest on a loan to “cover the earnings I’m not getting yet,” Harsip said. “This should be their cost, not mine.”

She’s not alone. The Denver Post heard from more than a dozen Coloradans frustrated by one hurdle after another trying to find out information about legitimate claims. Others, like Harsip, have had to take out loans or empty their savings to cover bills in the meantime.

In May, the CDLE reported “an uptick in fraudulent attempts to gain access to unemployment insurance benefits,” according to its website. “Fraudsters are attempting to hijack existing claims and file new fraudulent claims for people not already in the system.”

As a result, the department moved its fraud detection tools to the “highest possible level” in the spring after a year-long lull in “fraudsters,” a spokesperson said in a Thursday statement. “This stopped a massive amount of fraudulent payments from being issued.”

And it’s not that the agency doesn’t have reason to be concerned about fraud. During the COVID-19 pandemic, the agency issued around $73 million in fraudulent unemployment benefits in 2020.

The CDLE is reviewing “how it adjusts its fraud triggers to balance catching fraudulent claims while not holding up legitimate ones,” as it tries to keep up with tactical changes by fraudsters and “identities continue to be stolen in major data breaches unrelated to CDLE.”

It acknowledges that legitimate claimants are experiencing delays in payment because of the fraud holds, and the department is identifying large batches of “low-risk claims and releasing those fraud holds.”

As of Saturday, the agency estimated that roughly 4,000 claims were affected by the holds, with it predicting “some” of those to be actual instances of fraud.

On its website, CDLE directs claimants to call its phone number as “the fastest way to get help,” given that the lobby of its location at 251 E. 12th Ave. is shuttered until further notice as of July and its location at 633 17th St. offers “limited in-person help.”

“Unfortunately, when a claimant calls into our call center to inquire about their program integrity hold, our representatives are unable to provide specific details on the claim in order to prevent sharing information to ambitious bad actors, who have called in pretending to be the claimant,” the agency said in a statement.

When The Denver Post tried to reach a live agent on Thursday at noon, a recording directed the reporter to call back from 8 a.m. to 4 p.m. on a weekday. “You will not be able to transfer directly to a live agent on this call,” the recording states, with the phone line using a virtual assistant instead.

Struggling Coloradans

The holdup at the department has forced a number of unemployed Coloradans into limbo.

Eighty-one days have passed since Meredith Broome, 54, filed her last claim on June 11, which she still hasn’t received. The Denverite, who previously worked for hospitality and entertainment company Delaware North at Denver International Airport, filed a claim “with no issues,” fulfilling her required work search verification every week.

She started a new job on July 24, but “my claim was never approved nor denied before then,” Broome said. Instead, the status of her claim reads “inactive.”

Although she’s tried to contact CDLE several times via phone, “I can’t get through to a real person,” she said.

“I don’t know what else to do, but I would like to get paid for my claim,” she said.

On Saturday, the agency informed her that it deemed her claim “ineligible due to fraudulent misrepresentation and no benefits will be paid.” She plans to file an appeal.

Michelle Kettleborough, 47, has waited for two months for the government agency to issue her unemployment claim payments, which she started filing for on June 28. The Denverite lost her job at technology company Ibotta when it reduced its workforce.

“While my filing has been approved and a weekly payment amount set, the website says that my case is under adjudication and that I am ‘indefinitely ineligible,’ ” Kettleborough said. “There is no one to contact for clarity.”

Kettleborough described the biggest hurdles in the process as “the inability to contact anyone and the long hold times.”

Her requests for an in-office appointment haven’t received responses, “and the matter of verifying my ID cannot be completed online,” she said. When she’s tried to verify her ID on the agency’s mobile app, Kettleborough said she gets an error message.

For now, her financial situation continues to tighten.

“The severance I received has been exhausted,” Kettleborough said. “Now, we are several weeks behind in payments and that makes a financial impact.”

Although she has yet to receive a payment, that’s expected to change soon. On Saturday, Kettleborough was notified that she’ll get four weeks of claim payments in a few days’ time.

Jane Reuter, 59, was laid off by health care company UnitedHealth in 2009, and “had no problems at all getting paid” back then, she said.

Fourteen years later, she lost her job as a corporate communications writer for satellite communication service Viasat during a round of layoffs at the end of March.

The Arvada resident received 14 weeks of severance from Viasat, and filed “immediately for unemployment.”

But a representative at the government agency “told me I wouldn’t get any money until after the 14 weeks,” Reuter said. Even after her severance finished at the end of June, she hasn’t seen “a dime from unemployment, despite filling out my weekly job search activity and calling every two-three weeks to ask what’s going on.”

On those calls, she’s found it difficult to reach a human being to talk to.

“And when you do, only a few have been helpful,” Reuter said. “I’ve had people tell me, ‘There’s nothing I can do and no one else you can call.’ ”

She’s even gone as far as emailing the governor’s office.

On Thursday, a development finally broke in her case, and she was told that her issues “had been cleared up.”

“I should get a big check with several weeks of back pay from Colorado Unemployment soon,” Reuter said.

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