Unemployment fraud and how do we prevent it?

[cabmandone]

Don't know if this is considered "political" or not so if the mods think it is, go ahead and move it.
I was reading this morning about widespread fraud in unemployment claims. My accountant told me recently that there was a big problem in Ohio with fraudulent UE claims. Being that I'm self employed I have no idea how UE works or what is required to apply.

My question is, how do we secure the system and prevent fraud? My thought is that we should do what was done for those who were laid off as "non essential" where the employer creates a case number and the case number is used to apply for UE. It would seem to me that without the case number accompanying the application, there would be little to no chance of fraud. We also need to come up with some sort of new unique identifier rather than using Social Security numbers. Why do I say that? Me, my wife, my three kids, my parents, two of my brothers have all had our personal information compromised through a medical records data breech. SSN's aren't even remotely close to a unique identifier at this point.

https://www.msn.com/en-us/news/us/fraud-overwhelms-pandemic-related-unemployment-programs/ar-BB1e5UYU?li=BBnb7Kz

[onewhippedpuppy]

It was rampant in KS this year too, I know a number of fully employed people who supposedly made claims despite being fully employed. Now even worse is they are getting tax forms for the fraudulent unemployment money that they didn’t even receive. I’m not sure how to fix it, obviously there needs to be far better controls in place for verification instead of taking the Oprah “you get a car” mindset of just handing out money to everybody.

One other thought I’ve had, there has been a big disconnect in my mind between the supposedly huge unemployment rate over the last year and the number of people building new houses, buying new cars, boats, RVs, vacation condos, etc. It just hasn’t added up. But if every state has hundreds of thousands of fraudulent unemployment claims then that would artificially inflate the actual numbers and make things look worse than they really are.

[sc_rufctr]

Valid ID is the only way make sure people are doing the right thing and in Australia we have to provide a tax file number and valid ID to open a bank account. A tax file number in Aus is like your social security number. It follows you for life.

When I was a kid it was common for people to be claiming multiple "Doles"... These people weren't working and were claiming five or six unemployment payments paid directly into separate fake name bank accounts. This wasn't really fixed until computers came online (late 80s). But every now and again someone gets caught and it makes the news.

[cabmandone]

Originally Posted by onewhippedpuppy

It was rampant in KS this year too, I know a number of fully employed people who supposedly made claims despite being fully employed. Now even worse is they are getting tax forms for the fraudulent unemployment money that they didn’t even receive. I’m not sure how to fix it, obviously there needs to be far better controls in place for verification instead of taking the Oprah “you get a car” mindset of just handing out money to everybody.

That's pretty much the same thing my accountant told me. A lot of his clients are receiving the tax form for benefits but they were not unemployed and did not collect. Oddly enough, a lot of the people he spoke of were self employed. How the hell does the state miss that? You'd think we'd have something crossing benefits and tax filings. If the person applying for benefits files a schedule C... DENIED

Originally Posted by onewhippedpuppy

One other thought I’ve had, there has been a big disconnect in my mind between the supposedly huge unemployment rate over the last year and the number of people building new houses, buying new cars, boats, RVs, vacation condos, etc. It just hasn’t added up. But if every state has hundreds of thousands of fraudulent unemployment claims then that would artificially inflate the actual numbers and make things look worse than they really are.

I know what you mean. I've been saying the same thing. Where is all this money coming from?

[cabmandone]

The more I think about it, this can't help but be political. Our state legislatures are failing us. Unemployment fraud isn't something new and yet here we are. The only real saving grace that might keep this from getting booted is it shouldn't contain the same "red vs blue" that typically surrounds an issue. It's a mess from both sides that needs fixed.

[cstreit]

Many of us, most of my friends for sure) have had this happen in IL. Get an email from HR, “hey, did you file an unemployment application.

Criminals are so helpful, a few years ago they filed my taxes for me, now this.

Oh BTw, the irs didn’t send us our pin to file electronically, because COVID. We filed on paper. They still haven’t processed my 2019 return but have managed to tell us twice we haven’t filed it. We keep sending another copy with proof of delivery of the first few.

[GH85Carrera]

The real issue is government bureaucracy. The majority of lifetime workers at the state level don't really want to help improve things, and the politicians are swayed by the money from the lobbyists to keep the status quo.

I know of one state agency in Oklahoma that decided to upgrade the computer system from mainframes installed in the late 60s and early 70s. With YEARS of meetings, committees and more meetings they spent a huge sum of money and ended up with a proprietary system that was costing a fortune, not doing the job, and the company that got the bid had all the power to raise prices at will. It was a complete waste of money, and scrapped and yet another system was paid for. All the time, they still had to continue use the slow inefficient mainframes.

It is not the day to day employees at the state agencies, it is a management level, and legislature issue. And it happens at every state and double so at the federal level.

[wdfifteen]

In Ohio they are really lax as to who is eligible. A lot of money is handed out to undeserving people and it's perfectly legal.

[Rick Lee]

They keep UI so low in AZ, there's not much incentive to commit fraud. The weekly max is $240, and the state is militant about enforcing the rules around it.

[cabmandone]

This should be an eye opener for a lot of people in a lot of states. Every person who pays taxes should be irate at what is being allowed to happen.

[mgatepi]

Yep I got my papers early January. Got laid off after 27 years.....well according to the state unemployment office...
Locked my credit down, notified my banks, had HR contact the unemployment folks.....its happened to several folks I know.

[cabmandone]

Originally Posted by mgatepi

Yep I got my papers early January. Got laid off after 27 years.....well according to the state unemployment office...
Locked my credit down, notified my banks, had HR contact the unemployment folks.....its happened to several folks I know.

How do ya like that!? You were laid off and didn't get to enjoy a single moment of it!

Seems like an individual case number provided by the employer that is sent to the UE office for the UE office to verify would be an easy fix. A network web interface between employers with EIN's sending the info to the state and the state verifies when the employee files using that case number. Maybe the whole thing would cost more than the fraud costs the taxpayer? But as a taxpayer I'd rather see money being used to secure a system than watch it go to fraudulent claims.


BTW, 2 votes... 1 star... must be some UE fraudsters here.

[island911]

methinks that preventing fraud is not high on big brothers list of priorities.

creating a larger dependent class is part of the goal.

Originally Posted by sc_rufctr

Valid ID is the only way make sure people are doing the right thing and in Australia ....

Well in the US requiring valid ID is racist. - according to every SJW.

Of course it's not racist, but shrieking SJWs have to be dealt with.

[Rapewta]

I don't know how to prevent it unless I become a snitch.

Last year when my brother passed away, the five tenants-at-will refused to move out. Not one of them had a job and were living comfortable on my brother's disability pension and SS.
We evicted them. 60 day eviction expires and they don't leave.
Next step was the unlawful detainer. A week before serving them, evictions in California were suspended. They are still there after 18 months!

Now the Unemployment fraud..
These five bums all had a fellow here in town charge $500 each and filled out the forms for unemployed benefits retroactive to the point they all received $12,000 each last fall.
Yea. I know you might be sympathetic but these people I know and they claimed that being self employed, they could not work because of the Covid virus.
The house is next door to my Father's and I know they don't have jobs.

In you honest opinion, what do you suggest?

[island911]

Sue the State

[red-beard]

In Texas, unemployment pays a maximum about 50% of what you were making.

At present, there is a $300 per week bonus from the Federal government. Anyone making about $32K can take unemployment and make about the same money as working.

https://www.forbes.com/sites/shaharziv/2021/12/31/confirmed-11-weeks-of-extra-300--unemployment-pay-december-26-fpuc-start-date/?sh=768a001d50a1

From the $1.9T bill, there will be $400 extra per week until August.

In Texas, a person making $40Kper year, you will make "full pay" for 6 months sitting at home. Anyone who makes less than $40K, will be making "more" with unemployment.

My dentist is having trouble finding people to work, since the workers may make more "at home" than working.

[3rd_gear_Ted]

REAL ID is due to be in place nationwide by 10-21.
This individual information along with a relational database that can be universally accessed by other state entities is the not so simple solution for all the fraud at state levels.
The business systems needed to do this have been installed in major corporations. Doing the same @ the state level is the management challenge yet to be achieved in any state I'm aware of

[Superman]

I get pretty tired of folks announcing that society's woes all stem from Gubmit workers who don't care or perhaps they are actively trying to destroy democracy. Folks who talk like that are both angry and clueless.

Sure Glen, your story is likely true. That agency may have wanted to avoid wasting money and time on a proprietary system that ended up costing way too much and, if I don't miss my guess, was eventually abandoned. The "bureaucrats" typically want to do things right and have a clear vision for how to get it done. But then the "legislature" has a better idea....like contracting with a private entity for a computer system.

As far as avoiding unemployment fraud goes, it all depends on the state or other jurisdiction. In my state, we have a pretty good system for identifying and punishing fraud. The computer system with which I am familiar, in my agency and in our Employment Security department, are not outsourced. We spent the money to build our own system. This way, we can make improvements and the cost of the entire system is virtually limited to the cost of those incremental improvements. We do make substantial use of contract workers. IT people who know their stuff are in high demand and they are expensive, so we engage them by contract. We pay them substantial money to build our systems, but at the end of the day they are OUR systems.

At my agency we have an entire program that ferrets out fraud and they are pretty good at finding it. Is there still fraud out there? Yes, of course. If there were not fraud, then we wouldn't be having this conversation. Is the system perfect? No. But my state is actually run fairly well. Two weeks ago one of our fraud investigators was shot at. These guys are underpaid and they do dangerous work. Because they care. Because it is important.

Private sector workers are sometimes assumed to be superior to public sector workers. From my perspective, that is bovine excrement. I have spent my career going back and forth between public and private sector work, and the public sector people are the superior of the two. Car salesmen are in it for the money. There is no moral theme in their work. They sell cars. Working at a public agency which protects working men and women, and protects taxpayer money, is a bit more important and motivating than selling cars.

Now go back to ignorant gubmit-bashing. I understand it is a lot of fun for some of you.

[rfuerst911sc]

My 2 cents with no political agenda: all local/city/county/state/federal governments have to be held accountable for their budgets with penalties for going over the budget . Simple in philosophy but much harder in reality . The common men/women on this forum as an example I am sure have a household budget . You know x amount of $$$ coming in each month and x amount going out and budget accordingly . For those that " go over the budget " on a regular basis the " penalty " you pay is credit card interest or loans and their interest . If all of society would be budget accountable we would all be better off . With a federal government out of control with spending how is the common man going to feel like he should be responsible for his spending . Unless you were taught from an early age and have that personal integrity ............ well here we are .

[craigster59]

I was on unemployment from 4/1 - 9/1. Wasn't bad when we were getting $1,050 a week but it dropped to $450 and it's tough to live on that in California. Fortunately I had "saved for a rainy day" so I was fine, never missed a house payment and kept credit cards at $0.

Recently I got an email from EDD (unemployment) saying I needed to update my account at ID.me or my benefits would be canceled (I wasn't receiving them anyway). I checked and there were no payments past Sept 1st so no hacking involved.

I had to upload my driver's license to the website and then it sent a text with a link to my cell phone where it scanned my face and compared it to the picture on my license. I have to say I felt a little bit of a "Big Brother" moment and hoped it wasn't a scam. Checked websites and verification and it's definitely a "thing" with California EDD due to so much fraud. I guess at least they're trying to clean things up.