Dept. Of Labor Deputy Commissioner On How The State Is Handling Fraudulent Unemployment Claims

Jun 21, 2020

Thousands of Mainers have reported problems in trying to obtain unemployment. Thousands of other Mainers have had unemployment claims fraudulently filed without their knowledge since late May. The pandemic caused a sudden spike not just in real claims, but in fraud as well.

Maine Public's Jennifer Mitchell talked about these issues with Kim Smith, the deputy commissioner for the Maine Department of Labor.

Mitchell: So how many fraudulent claims are we aware of now at this point?

Smith: We've received 21,400 email notifications from people and from employers. We know that some of those may be duplicates, because it could be two people reporting the same case. But 21,400 email notifications of potential fraudulent claims.

How are people actually finding out that they have perhaps been a victim of this kind of fraud?

Both the employer and the individual receive information from us through the postal mail, and that's where a lot of our reports are coming from, that people are receiving these documents from us, and the employer is letting us know, ‘hey, that individual is still working,’ or the individual themselves is saying ‘I did not file this claim.’

Okay, so keep checking your mail to make sure that you're not getting those notices from the Department of Labor. Now, who is doing this and how are they doing it?

Well, I wish we knew who was doing it. It's coming in from other places across the country and across the world. And they're taking information that has been stolen from past breaches, external breaches. We've all heard about these big ones that happen, Equifax or Experian, or the Target breaches or the Hannaford breaches, they're really too numerous to mention all of the ones that we hear about on the news. So people's PII, their personally identifiable information, is out there. Criminals are using that information in sending fraudulent claims into our system.

So some of this could be linked to data breaches and incidents dating back, potentially, years. What should someone do if they receive a letter from the department that they, or an employee perhaps, has filed for benefits, and they know that that's not right?

We have a website where individuals or employers can report identity theft. And that logs a record for us that we go in and then flag the account as potentially fraudulent. Whether or not you think you've been a victim of identity theft, there are so many breaches out there, we really caution people to monitor their own personal accounts, your bank accounts, putting credit freezes on your account, those are all good things that people can do to make sure that they don't personally lose out because of identity theft.

I know some people are suggesting steps such as going to the Department of Labor and signing up for an account there without actually applying for any benefits, in the hopes that it could prevent someone else from doing that. Would that actually help?

I have heard of that from a couple of different places, and there certainly is no harm in creating an account in our system. I don't know whether or not that would be sufficient enough to prevent imposter fraud from happening. We have had incidents of someone's PII being used multiple times to file a claim. But no, there's no harm in doing that.

I was just going to ask about that. So if it happens once, it can happen again?

It is possible to have it happen multiple times. Even now we're seeing, as I said earlier, we're canceling claims that we believe are fraudulent, and we see them coming right back in again with that same PII.

What does it mean for the real person whose info is being used? Is it going to be harder for them going forward because now they have this fraudulent activity attached to them?

Well, we do have a flag on that person's account. And if, say, a year or two from now they need to file for unemployment, they are still able to do that through self-service. But we would need to follow up with them to make sure that we're actually talking with the real individual who is filing that claim.

All of these fraudulent claims are a reminder for everyone out there, whether or not you've been a victim of this particular unemployment, imposter fraud, to monitor your accounts — your bank accounts, your credit card accounts, your credit accounts, just make sure that you're keeping track of that stuff because our information is out there.