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RI has paid $8.6M in fraudulent unemployment claims

Target 12

PROVIDENCE, R.I. (WPRI) – Rhode Island has paid out at least $8.6 million in fraudulent unemployment claims throughout the pandemic, Target 12 has learned.

R.I. Department of Labor and Training director Scott Jensen said Wednesday fraudsters since March have consistently tried to dupe his agency into paying out unemployment insurance to the wrong people.

More recently, the criminals have used stolen information with people’s employment details to make the fraudulent requests more believable, he added. The method has made public sector employees especially vulnerable, as their employment information is more easily available online, he added.

“We do know that there’s a lot of state employees who are experiencing the same thing,” Jensen said, underscoring that this has happened despite his agency finding no evidence of a state data breach.

“What I would say is ‘online hygiene’ – for lack of a better way to put it – is important to look at,” he added. “For your employer, how much do they list online about personal information about their employees?”

When looking for online information, fraudsters typically search for names of employers, job titles and phone numbers. More sensitive information — such as security numbers and birthdays — are usually collected through past data breaches, such as the Equifax data breach in 2017, when the private information of nearly 150 million Americans was compromised.

“If they have personal information from an Equifax-type breach that would allow the fraudster to complete the picture,” Jensen said. “These guys are good at what they do and they are trying to take full advantage of the situation.”

Jensen wouldn’t comment on whether the state is seeing a second wave of fraudulent behavior, but several people have reached out to Target 12 about suspicious activity in recent weeks. The FBI in May launched an investigation into a flurry of stolen identity reports, which delayed benefits across Rhode Island.

Jensen said the state has paid out about $1.7 billion in benefits, 60% of which is federal money and the rest from the state. He said they have frozen more benefits on top of the $8.6 million, which means the stolen figure is likely to climb as they investigate those claims more deeply.

Those who believe their identity has been used to file a fraudulent claim need to fill out this form on the state police website, and those who have had their benefits frozen should use this link to begin the process of authenticating their claim.

Wanda Brito, a Providence resident, was collecting unemployment insurance after she was laid off from her job in childcare, which is an industry that was shuttered for several months. But the benefit stopped suddenly in April, and she later found out someone had stolen her identity.

“I don’t have any income right now and I’m trying to look for a job,” Brito said. “It’s hard, it’s been really stressful, not knowing who stole my identity. I don’t even know how that happened.”

Brito said she’s since been unsuccessful in receiving benefits and cannot connect with anyone at the DLT, which has become a common refrain among many who seeking help from the agency that’s been inundated with claims throughout the pandemic.

The DLT has received upward of 345,000 unemployment insurance claims since early March, including people applying and reapplying for benefits multiple times. In April, more than 23,000 Rhode Islanders were listed as unemployed, and the unemployment rate soared from 3.5% in February to 14.7% in April. (It has since fallen to 11.1% in June.)

More recently, DLT has reported a dramatic increase in claims for Pandemic Unemployment Assistance, a subset of unemployment insurance, designed for people who are self-employed.

On July 22, the department received 4,783 PUA claims, which is the second most only to the first day the program was offered on April 7 when 11,598 claims were submitted.  

The renewed surge of PUA claims coincides with the recent influx of viewers contacting Target 12, claiming they have received unemployment letters from the DLT – but are employed and have never applied for benefits.

Jensen declined to comment directly on whether the soaring PUA claims are related to the fraudulent activity, but he also didn’t deny that the two were connect.

“Just like you wouldn’t want a batter to see the signals of the pitch that the pitcher is going to throw, I don’t want to comment too much on that,” he said. “But what I can say is that we are diligently scrubbing PUA claims just like we were regular claims and we too have noticed the pattern in PUA.”

Jensen also said he could not discount the possibility that many self-employed people who tried to get back to work when the state started reopening are finding out that they can’t make ends meet.

“In a strange way, I wish it were all fraud,” he said. “But I also know we’re still struggling as the economy is opening up and, you know, the folks who are eligible for PUA remain vulnerable to unemployment.”

Tim White (twhite@wpri.com) is the Target 12 investigative reporter and host of Newsmakers for WPRI 12 and Fox Providence. Follow him on Twitter and on Facebook

Eli Sherman (esherman@wpri.com) is a Target 12 investigative reporter for WPRI 12. Follow him on Twitter and on Facebook.

Copyright 2020 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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