EMPLOYCO BULLETIN: Unemployment Insurance Fraud

NOVEMBER 05, 2020


The COVID-19 pandemic has brought forth an unprecedented number of unemployment claims, and in turn unemployment insurance fraud / identity theft is also on the rise. IDES (Illinois Department of Employment Security) Acting Director Kristin Richards stated, “rampant fraud is penetrating all state unemployment systems across the nation.”

The IDES recently released a “Message to Illinois Employers” in response to fraudulent claims: “Nationwide, bad actors are using the COVID-19 pandemic as an opportunity to file fraudulent claims for unemployment insurance benefits. Many of these claims involve the theft of employees’ identities.” You can read the full message here.

At Employco USA our UI Claims Technicians review every claim received daily. Quick processing and a timely investigation are vital to combating fraudulent activity. When a claim comes in, we:

Digitally log the claim into our system (along with all subsequent documentation)
Contact the client to start the investigation process and obtain a reason for separation
If we receive a response stating the claimant is still working and did NOT apply for unemployment benefits, we start a fraudulent claim process:
We protest the claim in writing, with confirmation from the client and employee that they did not apply for unemployment benefits – the state unemployment department will receive the protest, flag the claim in their system, and start an investigation
We advise the employee to immediately contact their state unemployment department directly
In Illinois, the IDES has a specific page on their website with information on how to report a fraudulent claim as an employee (either by phone via a scheduled call back or via an online contact form)
If this occurred in another state, we will provide information on how to report the claim online or via a live call
We advise the employee to NOT activate any debit cards they may receive in the mail - destroy them immediately
The employee, at their discretion, can also send us any fraudulent documentation they receive – we will review, keep it on file if needed for the future, and advise if any action is needed
We also advise the employee to take the same precautionary steps recommended for any case of identity fraud, including: reviewing their free annual credit report, contacting their banks and credit agencies, monitoring their SSN, etc.
At the end of every quarter we will also receive a Benefit Charge Statement from each state, we review all charges and ensure no errors were made - if any are found, a protest is made with the state
In Illinois, “You will not be held responsible for the fraudulent claim if the investigation finds that you were a victim of identity theft. That is why prompt reporting and not activating the card are critical steps in this process.”

The same is true for other states with quick action and proper documentation.

Employco takes fraudulent activity seriously and is here to help throughout the process. Please contact us immediately if you believe you were a victim of unemployment insurance fraud. We’re here to help!