Covid-19 Double Whammy: Losing Your Job and Hit by Identity Theft

Here in Colorado we are hearing stories that are likely being played out elsewhere.

A server went to file for unemployment benefits after being laid off and discovered that someone else was claiming benefits in their name.

This is a rotate on the old tax refund scam where someone claims a tax refund that is due to you.

In this case the crook obtains some personal information like name, birth date and social and filed for benefits IN A DIFFERENT STATE.

Historically, this has not been a problem for state unemployment departments but right now, with unemployment claims up by a factor of 10x and nationally by new claims are up by 20x, departments are probably doing a lot less due diligence than they need to be doing.

What is apparent is, like we saw a few years ago with tax refunds, the government was not and is not prepared to deal with fraud in unemployment claims. Hackers are always the leading edge.

Given that some of the systems that the states are using are 20, 30 and even 40 years old, it is highly unlikely that the states will create a systemic fix any time soon.

This person is apparently out of luck because they don’t know what state the claim was made in. I am guessing the states will need to be on the wrong end of a lawsuit in order for them to change this nationwide.

Even just trying to reach the state unemployment departments on the phone is more than a challenge.

For people who lost their job to be a victim of identity theft and have their safety net ripped out from under them – that is a huge problem with no quick fix.

Source: CNet

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