Fraud Penetrating All State
Unemployment Systems, IDES Taking Steps to Detect, Mitigate, and
Pursue Fraudsters
Federal Guidelines Make Pandemic
Unemployment Assistance Program Susceptible to Fraud
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[September 15, 2020]
IDES has uncovered and is investigating a
widespread fraud scheme that is being conducted nationwide,
impacting each state’s federal Pandemic Unemployment Assistance (PUA)
programs, implemented as a result of the COVID-19 pandemic.
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PUA provides 100% federally funded unemployment
benefits for hundreds of thousands of individuals who were not
traditionally covered by a state’s regular unemployment insurance
program, including self-employed and sole proprietors. Under this
program, 39 weeks’ worth of benefits are available to PUA claimants
whose claims can be backdated as earlier as February 2, 2020, with
benefits ending December 26, 2020.
The Department is aggressively cracking down on this fraud network,
whose dedicated team of staffers responsible for handling and
investigating unemployment fraud are working directly with
individuals whose identities are being used or have possibly been
stolen. IDES is also working with local and federal law enforcement
authorities to investigate, pursue, and prosecute those who are
defrauding the unemployment insurance system.
An individual who has not filed an unemployment claim but has
received a debit card or an unemployment insurance (UI) finding
letter in the mail has most likely been the target of fraud. An
individual’s personal identifying information is being used by
fraudsters to file an unemployment claim is likely due to a prior
cyber hack or data breach, such as the Equifax breach. It is
imperative that individuals take the following steps if they have
not filed an unemployment claim and have erroneously received an
unemployment debit card or UI finding letter in the mail:
Immediately call IDES at 800.814.0513 and when prompted:
o Select the English or Spanish language option
o Selection option 1 for claimants
o Selection option 5 to report identity theft
Do not activate the debit card that was mailed to you.
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Have your credit report checked for possible
suspicious activity and post a fraud alert.
Visit the Federal Trade Commission’s website to learn helpful tips
on recognizing and reporting identity theft.
The increase in the fraudulent unemployment claims is
believed to be coming primarily out of the Pandemic Unemployment
Assistance (PUA) program. Under the ambiguous federal guidelines,
which were developed in haste because of the urgency of the pandemic
and issued to every state without a uniform method of
implementation, the potential for fraud within this system is
abundant.
One of the largest vulnerabilities within PUA is the absence of an
employer on the other side of the claim to contest the claim in the
event the it is fraudulent or should be protested. Under regular
unemployment insurance guidelines, an employer has the ability to
alert IDES if a claim has been filed in the name of an employee who
is currently employed, and has the ability to protest a claim if
they believe the employee does not fall into the category of having
lost work through no fault of their own.
This fraud scheme is in no way connected to the PUA program access
issue experienced in May. The limited data access issue of the PUA
system found that one PUA claimant was able to inadvertently access
personal identifying information of a limited number of claimants
who had already filed an unemployment claim. Out of an abundance of
caution, a year’s worth of free credit monitoring was provided to
any claimant whose information may have been inadvertently viewed by
this one individual claimant.
[Illinois Office of Communication and
Information]
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