Unemployment fraud and the truth about identity theft
Turn that frown upside down. Connecticut’s unemployment rate is a mere 3.7%. Most economists believe 4% is full employment because in a dynamic economy it’s important that some people are leaving jobs and looking for new ones. But no one who has paid attention to the state’s economic storms of the past 15 years is going to complain about a 3.7% unemployment rate.
Unemployment in a vigorous economy is like an airport. It may be busy each day but not with the same people. In June, 70,000 people in Connecticut were unemployed and 33,000 people filed for unemployment compensation, revealing that most of the unemployed are using the program for a short time. Since there are thought to be 100,000 unfilled jobs in the state, most of the unemployed should have no trouble finding another job.
The state has yet to return to its March 2009 peak employment of 1.72 million jobs. But let’s take our good news where we can find it.
The people of Connecticut have by millions of individual decisions improved our prospects. Readers, you do not give yourself enough credit for making our lives better.
Now, take that frown you turned upside down a few paragraphs ago and put it back in its natural state. With a historically low peacetime unemployment rate comes a bewildering phenomenon. Thousands of fake unemployment claims are challenging the state’s Department of Labor — every day.
Since March 2020, the start of the pandemic in Connecticut, the Department of Labor reports stopping 385,000 fraudulent applications for unemployment benefits. The agency recently disclosed it continues to receive thousands of fake claims each day. The numbers and anecdotes indicate that fraudulent claims are not detected. Criminals are receiving payments.
According to DOL spokesperson Juliet Manalan, there has been no breach of the agency’s data or that of any of its contractors. The source of the crisis is identity theft. This will seem counterintuitive but the strict and sensible restrictions that prevent some state agencies from sharing information with each other slows the detection of fraudulent claims that make it through the initial screen.
Many Connecticut businesses have learned that they and their employees have been the target of unemployment compensation fraud when the DOL sends a routine confirmation of claims by employees — most of whom still work for the employer receiving notice of an unemployment claim. The process of straightening out the fraud is frustrating. Victims need to notify the DOL of the unemployment fraud. This can be frustrating because it is not easy to reach DOL employees by phone,
which at times appears to be by design.
The fraudulent claim means the employee has been the victim of identity theft. The DOL website includes a primer on this frustrating and costly modern plague. Today, the criminals possess more diabolical tools to do bad than law enforcement has to thwart or catch them.
Between May 2022 and this June, only seven prosecutions for fraudulent unemployment claims have been brought by state prosecutors, who have recently revived an agreement to work with the DOL. DOL and the Division of Criminal Justice emphasize these prosecutions are not for identity theft. They are people alleged to have gamed the unemployment system.
Identity theft is your problem. For that, you should contact your local police — and wait.
Our leaders have been reluctant to acknowledge an unpalatable truth. The fraudsters are winning. It is unlikely that victims will receive any satisfaction. We are told to be careful with our information. You can learn the clues of a scam.
Identity theft schemes are becoming more sophisticated. Perpetrators can unleash untold numbers of attempts to steal.
Only a small percentage need to thwart safeguards to claw cash from unsuspecting marks. According to DOL, much of our personal information is available on the dark web, for sale for as little as one dollar.
These are multi-state conspiracies and that cripples local law enforcement’s ability to do anything beyond making a report and adding it to the frustrating statistics of crimes that will not be solved.
Banks have encouraged the move to consumers handling their own finances online. Still, meet the people who work at your local bank. They can be helpful in the crunch. Buy some protection services. Don’t respond to unfamiliar texts. Do not engage in conversations with what appear to be telephone marketers. Give no personal information to callers from nonprofit organizations asking for a donation and your credit card number. Remind elderly relatives and friends of these safeguards.
Identity theft and all that flows from it will continue to grow. One immutable fact remains: You are on your own to avoid becoming a victim.