About 200 cases reported in Okanogan County
Some 200 individuals in Okanogan County are among the victims of widespread unemployment fraud in Washington state.
The state processed tens of thousands of fraudulent unemployment claims and paid out hundreds of millions of dollars, “a jaw-dropping number,” Suzi LeVine, commissioner of the state Employment Security Department (ESD), said in a news conference on Thursday (May 21).
What started as a trickle of reports of impostor fraud became a flood, as more individuals and businesses called the Employment Security Department (ESD) to report a bogus claim in the previous two weeks, LeVine said.
The claims were filed using personal information that had already been stolen in a data breach. It was not a breach of the secure ESD system, she said.
Unemployment fraud has been happening across the United States, LeVine said. Washington has been especially hard-hit because the state scrambled to provide benefits as quickly as possible to people out of work, balancing that aim with the need to validate the claims, LeVine said.
The ESD was “laser-focused” on getting money to people as rapidly as possible, and to ensuring that workers who are typically ineligible for unemployment benefits, such as the self-employed, also got checks quickly, LeVine said. More than 750,000 Washingtonians received benefits, but some are still waiting for their payments to begin.
Washington may have been an attractive target because the state pays the second-highest unemployment benefits in the country, she said. Both state and federal money were paid out in error, although the majority was federal.
ESD is now holding unemployment claims for several days to be sure they’re authentic, in a delicate balance between getting money to desperate people and blocking fraudulent claims, LeVine said.
The agency has definitive proof that their countermeasures are working. The measures have already prevented thousands of fraudulent claims that would have resulted in the improper payment hundreds of millions of dollars, she said.
The fraud has targeted people working for a broad spectrum of employers in the public and private sectors, LeVine said. Reports of fraud to the Okanogan County Sheriff include dozens of bogus claims for people working at the Methow Valley School District and other school districts in the county, the Okanogan County and the Douglas County public utility districts, Coca-Cola, and the town of Conconully.
LeVine declined to provide more details about the number of cases, the steps ESD has implemented to protect against further fraud, and how they’re working to recover the money. ESD is not sharing details because of the ongoing investigation and to avoid providing a road map to the criminals, she said.
Surge in claims
The fraud occurred against a backdrop of “unprecedented economic disruption,” with the state’s unemployment rate surging from 5.1% in March to 15.4% in April, a toll that’s expected to rise further in May, LeVine said. Since the economic crisis caused by the coronavirus pandemic began, 768,000 people have filed unemployment claims.
The U.S. Secret Service issued an alert on May 14 saying that “a well-organized Nigerian fraud ring [has been] exploiting the COVID-19 crisis to commit large-scale fraud against state unemployment insurance programs.”
Washington has been the primary target, but all states are vulnerable, according to the alert. Individuals who don’t live in Washington have been getting direct deposits from Washington’s unemployment program for names with no connection to the account holder, according to the alert. For this volume of applications, the fraud ring must possess a substantial database of personal information, the alert said.
Washington is working with the federal government and other states to investigate and catch the criminals and to recover the money, LeVine said. She declined to provide details about any suspects in the investigation.
Victim of fraud?
Individuals who believe they are a victim of unemployment fraud should report it to the state at http://www.esd.wa.gov/fraud.
That web page also contains information for assistance with identity theft from the state attorney general and the Federal Trade Commission.
ESD may seek additional information to verify a claim. Legitimate requests will direct the claimant to http://www.esd.wa.gov.
Check for fraudulent claims: Go to the ESD website at http://www.esd.wa.gov and set up an account to see if there have been any fraudulent claims involving your name and Social Security number. If you haven’t filed for unemployment and you can establish a new account, it means there haven’t been any claims using your information. If it says the Social Security number is already in use, that could indicate a fraudulent application, according to the ESD.