An Unemployment Twist on Identity Theft
Identity theft is a major problem
in the U.S., worldwide actually. Who
hasn’t received one of those emails saying “I’ve decided to leave my fortune to you”? I
get at least a couple a day. It’s a shame
that there are people out there who prey on the unsuspecting that way. Recently,
we have been seeing more of a new twist on identity theft, stealing a person’s identity
to collect unemployment benefits. Four
people in New York recently
stole the identities of more than 100 former workers in order to file for and collect
unemployment which resulted in close to $95,000 in false payments.
Scamming the unemployment system
isn’t new, but it has become more lucrative. Since
most states have triggered extended benefits and with the federal unemployment extensions,
someone making a fraudulent claims could theoretically collect as much as $30,000
per identity stolen which seems to make it more worth the risk to some. We
are definitely seeing and hearing more about identity theft issues these days.
This rise in identity theft fraud is putting
further strain on an unemployment system where more than half of the state funds today
are insolvent. They are borrowing from
the federal government in order to pay out benefits which come at a high cost to employers
who start to lose FUTA credits if loans aren’t paid back in time and also could see
interest costs start to accrue. All of
this ends up coming out of the employer’s pockets and frankly out of the claimant’s
pockets as well. Given the poor state
of unemployment trust fund affairs these days, legislators are forced to not only
increase employer taxes to bring in new revenue, but start to decrease benefits by
reducing payments or making them harder to qualify for.
What can employers do to help? Fraud
is hard to catch, particularly when 2 or more individuals are colluding, but employers
can very carefully check their charge statements and if anything does look out of
the ordinary, contact their state’s unemployment office to report it. It
won’t stop identity theft fraud in the unemployment system, but in these tough times,
every little bit helps, right?!!
This weblog is sponsored by TALX.
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