Fraudulent Unemployment Claims are the Latest Scam. Here’s What To Do if it Happens to You.

The more we have moved our lives online, the more identity theft has become a problem. In 2019, the Federal Trade Commission (FTC) reported that there were 3.3 million instances of reported identity theft and fraud in the US. You may think that number is shocking, but 2020 saw an unbelievable 45% increase in identity theft, leading to a staggering 4.8 million claims. 

Nearly one-third of that figure involved the theft of government stimulus money and unemployment benefits. All in all, around $200 billion was snatched up by criminals who managed to steal personal credentials and use them to apply for unemployment and other COVID-19 related funds. 

The recent COVID-related layoffs have inspired scammers to take advantage of companies that might not be paying attention to the flood of claims coming in. That is what recently happened at Borland Benefield, and nearly everyone in the office was affected.

Perhaps you have seen an email that looks like this:

In this case, the scammer had fraudulently applied for unemployment benefits in Natalie’s name by using her Social Security number, even though she has been continually employed by Borland Benefield for several years.

Fortunately, though, this office-wide attack failed. 

Dede Hutcheson, Borland’s Chief Financial Officer, was the first to spot the suspected fraud and shared this information with Natalie. “We have seen a number of these claims coming into our office and we managed to catch the tell-tale signs of scammers and criminals working behind the scenes. No damage was done to our records.”

What To Do if a False Unemployment Claim Happens to You:

If your business receives what you believe to be a false claim, there are two things you have to do. First, the employer must reject the claim.

“If a company is set up to receive emails when an unemployment claim is filed against their account, they will be able to respond to a fraudulent claim much quicker than waiting for a notice to come in the mail.” Dede explained. “Each time I received a fraudulent unemployment claim, I was able to log into our account with the Alabama Department of Labor right from the email and go through the steps to report the claims as fraudulent.”

It’s important to notify the Department of Labor as quickly as possible to ensure the scammer does not receive benefits under an employee’s social security number and that the company isn’t charged with a fraudulent claim that would make their rates go up.

Next, the employee must file a claim with the Alabama Department of Labor, stating that their social security number has been used to file a false claim. Once you get to the page, choose the option that states: “Report That You Suspect Someone Has Used Your Social Security Number to Work or Claim UI Benefits”

You will be taken to a form to fill out the necessary information (your contact info, who you suspect has stolen your identity if you know them, what tipped you off to the fraud in the first place, etc.) to be sent off to the Department of Labor.

Many of Borland Benefield’s employees had to go through the same process, but it managed to report the fraud and head off any damage.

Tips to Prevent Identity Theft

Consumer.gov breaks down the prevention of identity theft into three main sections. Here are some simple things you can do to protect yourself.

Home:

  1. Keep your financial records, Social Security cards, and Medicare cards in a safe place
  2. Shred papers that have your personal or medical information
  3. Take mail out of your mailbox as soon as you can
  4. Never give your social security or credit card number to an inbound phone call

Business:

  1. Only give your Social Security number if you must. Ask if you can use another kind of identification
  2. Do not give your personal information to someone who calls you or emails you

Online:

  1. Use passwords that are not easy to guess. Use numbers and symbols when you can
  2. Do not respond to emails or other messages that ask for personal information
  3. Do not put personal information on a computer in a public place, like the library 

These steps may seem obvious, but they are still vital, especially those involving online safety. We all want to be safe on the internet, but it’s not hard to tell yourself that it doesn’t really matter if I use the same password for just a few different sites. Don’t do it!

How to Repair It

If you do end up becoming a victim of identity theft, don’t panic. You can minimize the damage by staying calm and acting quickly.

Identitytheft.gov goes through this process step-by-step, from what to do immediately, to the longer process of setting up new accounts and information. The site also breaks down identity theft into major classes, such as medical, tax, and child fraud, and gives specific directions to take in each of these cases.

The general steps to begin the repair process, however, are as follows:

What to Do Right Away:

  1. Call the companies where you know fraud occurred
  2. Place a fraud alert and get your credit reports
  3. Report the identity theft to the FTC
  4. File a report with your local police department (this is an optional step)

What to Do Next:

  1. Close new accounts opened in your name
  2. Remove bogus charges from your accounts
  3. Correct your credit report
  4. Consider adding an extended fraud alert or credit freeze
  5. Review your credit reports often and regularly

Borland Benefield knows that identity theft can be a terrifying situation to find yourself mired in. If it happens to you, remain calm and follow the steps and links above.

Just remember that this isn’t a rare occurrence. Many people deal with identity theft, so you shouldn’t feel isolated. The help is out there, and Borland Benefield wants to make sure that you have all the information and support you need to get your life back on track.

Steady. Accurate. Consistent.

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