Colorado Springs, Colorado 2021-01-14 06:03:00 –
Guy Mendt was worried when he checked his mailbox on Monday. Two 1099 tax returns have arrived from the Colorado Department of Labor and Employment, informing him and his wife that they are obliged to pay taxes on an unemployment allowance of approximately $ 7,200.
Both retired Mens realized they were fighting unemployment fraud. again.
The Windsor couple thought they had taken care of everything in August after the two US Bankrelia cards appeared in the same mailbox. Mendts learned that their identities had been stolen and used to claim unemployment benefits, as other Coloradans received unexpected debit cards by mail. They filed fraud reports with the State Department of Labor and local police, called the US Bank to cancel the card, and confirmed the credit report.
“They tell you,’Oh, file a fraudulent claim and take all these steps.’ You have to trust the system that everything is blocked and okay,” unemployment. Ment, who has failed in the past few days trying to contact humans in the office, said. “(Now) I have an income of $ 7,200 between my wife and I. I’m not so excited to pay both state and federal taxes.”
Mendts were involved in a fraudulent fraud involving the state’s unemployment system for most of 2020. Tens of thousands of Coloradans had informed authorities about the scam and then needed to protect their personal data more tightly. It also did not benefit thousands of legitimate Gigres workers, as their allegations were considered suspicious and payments were withheld for several months.
Scammers who use stolen genuine identities have targeted the unemployment system with some of the billions of dollars available. The Colorado Department of Labor and Employment said it stopped paying nearly $ 1 billion in September, but an unknown amount was paid. The state reported that it had recovered $ 40 million in the fall in collaboration with law enforcement agencies. Labor authorities will provide the latest information on Thursday.
However, most victims are unaware of fraud until some special event occurs. Pueblo’s independent contractor, Cynthia Manjares, learned that her name was hijacked in June, after she tried to apply for unemployment in September.
Julie Morris said she knew her identity was used only when the employer told her that someone had applied for unemployment in her name. She and her employer challenged the claim last month.
“(January 7th) My employer was informed that the claim was approved after I reported it as a fraud and the employer objected,” Morris said in an email. “My employer also learned that I currently live in Yucca Valley, California. Of course, I live in Yucca Valley, California.
After Christmas, when the federal program ended, a new wave of fraud began. Criminals are now chasing state institutions that have paid profits to those who are eligible for regular unemployment. When an upgraded computer system called MyUI + came online on Sunday, 20% of the complaints made that day were flagged as fraudulent.
“We were watching when we introduced the new system at 6:30 on Sunday morning,” said Cher Haavind, Deputy Director of the State Department of Labor. “We were all on the dashboard and could see where people were attacking the system. They were from outside the United States. They were from Nigeria. And we introduced the system. I tried to access MyUI + within 5 minutes. ”
Why did that happen? 10-day rule
Last summer, a victim who discovered that a stranger had applied for unemployment in his own name was told to fill out an online fraud form from the Ministry of Labor. The Google form was checked by a labor staff member who manually updates the suspect’s account.
Victims filled out tens of thousands of forms and the backlog increased. During times of rapid unemployment, it took time for staff to do the tedious manual labor.
In a normal era around 2019, the Ministry of Labor processed an average of 1,900 new claims per week. Since mid-March 2020, an average of 17,600 new claims per week have been excluded from the federal program.
It was Executive Order D2020-012 that joined the enthusiasm. In March, Governor Jared Polis ordered the Ministry of Labor to promote payments to displaced workers. Specifically, he ordered the Ministry of Labor to pay the claim within 10 days of completing the application.
“We need to make a profit, which makes sense. We have seen historic levels of unemployment and, as part of that, criminals using our process.” Harbind said. “Currently we are doing due diligence on fraud. We are just trying to find a balance.”
Some employers also made mistakes. When the state notified that an employee had applied for unemployment, the employer was also to file a fraud report. However, if the employer checked “Other” on request, the Ministry of Labor treated it as a turnover and needed to decide whether the worker was eligible for benefits. Payment will be suspended until a decision is made. The governor’s 10-day order changed the process.
“These issues have been resolved, cleared, and paid according to executive orders,” said Phil Spesshardt, Health Services Manager, State Labor Department. “If we didn’t do that, some people would have filed a claim that came into effect on March 15th, but yet … they wouldn’t have received a dime yet. To unemployment and the economy in this state. There was an act of balancing (to prevent) the further chaining effects associated with the drag. “
By the end of July, the Ministry of Labor had distributed a $ 4.28 billion unemployment allowance, which helped hundreds of thousands of Coloradans pay rent and other invoices.
State officials began admitting fraud in June. It intensified in the summer and new state anti-fraud controls were implemented. By the end of summer, thousands of people who were legally unemployed had stopped receiving benefits. Their accounts were flagged for fraud.
It wasn’t just Colorado.
The organized crime ring in Nigeria was one of the earliest groups of attackers identified in the state’s unemployment system. Security news researcher Brian Krebs said in late May that the Secret Service had no jobs for criminals to “receive deposits directly from fraudulent transactions and transfer most of the fraudulent funds to the perpetrators.” I reported that I learned that I was recruiting.
U.S. Labor Inspector General Scott S. Dahl told Parliamentary Commission on June 1 that unemployment fraud could reach $ 26 billion “put in the pocket by fraudsters instead of going to legitimate workers.” Said there was.
Richard Bird, Chief Customer Information Officer of Denver’s security firm Ping Identity, says it’s a disadvantage for everyone to quickly drive profits without any security controls.
“The scale and breadth of this, and the unintended consequences of choosing something faster than safe, has resulted in a chain of damage, problems, and problems,” he said. “Colorado citizens will have to waste their time proving that they didn’t apply for unemployment. It wasn’t their fault, but they were forced to fix it. Let’s do it. “
However, fraud prevention controls have frozen thousands of legitimate accounts. Many people couldn’t get benefits for weeks or months and told Colorado Sun that they were near the homeless or lived in a car for it. They couldn’t get to customer service to find out what happened. The agency has decided to lift some holds in September, based on reasonable assumptions. A few such unemployed people may actually live at the same address.
Bird said the problem could resolve itself when the pandemic subsided, people returned to work, and the state returned to full employment. With fewer complaints, it’s easier to spot fraud. However, local governments can address this issue today by investing in security and protecting citizen data.
“It’s a vicious circle and has never been created for security,” Bird said. “The Fed raised money without expecting security. We advertised all this hundreds of millions of dollars available to the public. The bad guys saw the news and stole money. And it’s just I kept going. “
The federal government has increased funding for the state’s system to combat unemployment fraud. But there are so many other factors, Harbind said.
“This is the result of a pandemic in which criminals prey on innocent victims and use their stolen identities,” she said. “Soon they will file a fraudulent tax return, and that will be the next story. They answer many questions, such as” How can I achieve this? ” Sure, the latest technology, like MyUI +, helps us, but it’s also the criminals who are waiting for this opportunity to prey on people who didn’t know their ID was compromised in the past. .. “
Next Steps for Victims
State Department of Labor — They know. They know about thousands of workers with scam holds. They know there are backlog fraud reports filed by victims and employers. They know about the 1099s.
As part of that, US Bank officials said they would invalidate the card if they learned it was improperly requested.
By having victims submit fraud reports, the State Department of Labor planned to stop mailing 1099 tax returns. But there were too many. Since Christmas, over 20,000 fraud reports have been submitted.
Next week, another validation tool will be implemented to continue cracking down on claims based on fake identities. As part of the process is now automated, the new computer system deployed on Sunday should reduce the delay in flagging accounts reported fraud by victims.
The tax return was mailed on January 7th. If you receive an unexpected 1099 return by mail, a new return will soon be available to notify the state.
And he recorded all the calls and messages in the process of clearing the name, but for people like Guyment who received the 1099 tax return anyway, “Ultimately, he is responsible for them. No, “said Spechard.
“We can automate that part, so we can eventually see fraudulent charges and ensure a shutdown,” says Spechard. “And we’ll send the modified and modified 1099 to those individuals, and to the extent we have to modify the files sent to social security and the IRS, we’re considering doing so too. , They know what to expect. ”
Victim of unemployment fraud?
If you receive a USBank ReliaCard for unemployment benefits but do not file a claim, the state recommends that:
- Submit a fraud report to the labor department.
- Submit fraud reports to the US Bank, a bank used in more than 12 states to distribute unemployment benefits. Alternatively, call 1-855-282-6161 to invalidate your card.
- Contact three consumer credit research agencies and warn your name and social security number of fraud and theft of your personal information. Equifax: 1-800-525-6285; Experian: 1-888-397-3742; TransUnion: 1-800-680-7289
- Submit a “counter report” to the local police to create a record
- Report theft of your personal information to the Federal Trade Commission at identitytheft.gov.
- Guy Mendt continues to freeze credits after experiencing identity theft a few years ago. He just lifts it when needed.
- Richard Byrd recommends contacting local and state representatives to ask them to increase the security of their personal data in all departments.
- According to Phil Spesshardt, scammers are delivering cards to sellers and renters where no one checks their email. Landlords and sellers should check their mail on a regular basis.
- Get a preview of your daily emails using the United States Postal Service’s informed delivery service
Victims reported unemployment fraud to the Colorado Department of Labor. The state didn’t stop the claims. Source link Victims reported unemployment fraud to the Colorado Department of Labor. The state didn’t stop the claims.