Unemployment insurance fraud slows down claim processing

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The Washington state Employment Security Department (ESD) has delayed payments for 1-2 days as it attempts to validate all claims as authentic. According to a report in today’s Seattle Times, the state has been defrauded out of hundreds of millions of dollars for fake unemployment claims. The U.S. Secret Service has attributed much of the fraud to criminal rings operating out of Nigeria.

According to ESD commissioner Suzi LeVine, "This is happening because bad actors have acquired people’s personal information through other data breaches outside of the agency. Criminals then use this information to fraudulently apply for unemployment benefits in someone else’s name. There has been no data breach from ESD’s system.”

If someone receives notice from the state regarding an unemployment claim that they have not made, they should contact the department to report the fraud.

“We are digging into the scope and scale of the problem and remain committed to transparency and security. We will share additional information and actions customers can take soon. You can read more about imposter fraud and report it at esd.wa.gov/fraud,” LeVine concluded.

In a report issued today, ESD reported there were 138,733 initial regular unemployment claims (an increase of 29,308 from the previous week) During the week of May 10-16, and 1,670,580 total claims for all unemployment benefit categories (an increase of 369,016 from the previous week) filed by Washingtonians. The department believes some portion of the high numbers from the past week are due to an increase in fraudulent claims and is looking into how best to correct for that in future reporting cycles.

ESD paid out over $1.01 billion (an increase of almost $256 million from the previous week) for 565,764 individual claims (an increase of 28,450 from the previous week).

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