Unemployment Compensation Fraud on the Rise
With school out for summer, we’ve seen an uptick in fraudulent unemployment claims involving identity theft. Employers and victims should comply with state fraud-reporting procedures to avoid repercussions from these criminal activities. Here’s further information on how you can protect your district and your staff.
Criminals are stealing school employees’ identities from unknown sources and filing fraudulent unemployment compensation claims. Illegally obtained benefits may then be billed to the school’s TWC reimbursing account if not reported and stopped.
Fraudulent claim numbers are nowhere near their 2021 peak in the aftermath of pandemic-related unemployment funding. Still, small but persistent numbers of fraudulent claims have been reported by several schools over the past month.
Identify the Red Flags
If you suspect a claim is fraudulent, start by verifying whether the claimant still works for you. Contact the employee to inquire if the claim is real. If not, one of your employee’s identity has likely been stolen.
Other red flags could include:
- Incorrect Social Security number
- Claimant name misspelled
- Using a maiden name
- Claimant never worked for you
- Victim receives TWC packet with instructions for filing a claim or requesting payments, but the employer never received the claim form
Be aware that some school employees may file for unemployment compensation benefits over the summer if they are not scheduled to work. For these claims, the district is protected by their Letter of Reasonable Assurance or contract status. These claims are not fraudulent but should be protested to the TWC.
What You Can Do
The TWC is not able to immediately void fraudulent claims as was possible during previous years of high unemployment. TWC representatives offer these instructions to address suspected fraudulent claims.
- Call or email the victim and tell them you received an unemployment claim in their name. Most employees are surprised to learn they’ve been targeted.
- Respond to the TWC form and notify the TWC that the claim involves identity theft. Mark the form indicating the claimant still works for you.
Information You Can Share with Victims:
- Visit the TWC’s online fraud center.
- Click the green “Report ID Fraud” button and follow the instructions.
- Report identity theft to the Federal Trade Commission.
- Consider hiring a commercial fraud monitoring service.
- Check your credit reports.
Employers should review their quarterly statements for suspicious claims. Employees should check their mailboxes and protect their personal information to prevent further damage such as credit cards and loans taken out in their names.
Fund members with Unemployment Compensation coverage can contact us for support in identifying and responding to fraudulent claims.
James Ezell serves as TASB unemployment compensation attorney. Ezell supports Fund members in preparing for TWC appeals and hearings, protesting claims, and getting fraudulent claims voided.