Unemployment fraud is happening all across Arizona, with many people receiving unemployment benefits that they don’t need. This has left people who are in need of unemployment benefits but haven’t received them confused about what to do and where to get help.
Unexpected fraud is a federal crime that is punishable by fine or imprisonment. There is still an ongoing investigation regarding unemployment fraud and how to help the victims of this fraud. The total rate of unemployed people in Arizona is 7.5% and Arizona is one of the hardest hit states with the pandemic, making it easy for people to take advantage of the situation.
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Here are some steps one can take to report fraud.
• Report fraud by filling out a form online with DES
• Report Identity theft to the Federal Trade Commission
• Report fraud to the National Center for Disaster Fraud (NCDF)
• Report it to the three credit agencies: Transunion, Experian and Equifax
Arizona is also one of the top states in the nation for people testing positive of COVID-19, according to azdes.gov. Its economy was booming before COVID-19 hit the state back in March, 2020. This forced private companies and governmental entities to allow many employees to work from home. Businesses closed temporarily due to Governor Ducey’s Executive Order 2020-18. This left people uncertain about what would happen to their jobs in the future, in addition to the fear of contracting the virus.
People Not Receiving and receiving UI Benefits
There are also some people who applied for unemployment benefits, yet still have not received them. William Stollar, now retired, is one of those who thinks that insurance fraud is prevalent. He says, “It’s possibly because it’s easy, and nobody really minds cheating the government.”
He continued by saying, “I think most of potential fraud is just forgotten about, and pushed to the back of the important items that are necessary to be resolved. They are lost in the machinery of big government. I think that if one is self-employed, and considers that he will be required or would like to apply for unemployment, that he will be required to keep good and close records of his activities, his income, etc. Records are sometimes needed to be provided to the authorities. This is often done with a great deal of difficulty on the individual’s part. I think that’s just part of governmental red tape. Everything about the government seems to grind slowly, but very fine.”
“It was easy, but I just wasn’t terribly concerned about unemployment benefits. I’m at the stage where I’m retired, receiving social security benefits, living reasonably on social security and a few other things, including savings. I just don’t need the unemployment benefits that much,” said Stollar.
A Scottsdale resident has said that she has received benefits from Kentucky in spite of never working, traveling, or living in that state. She wanted to be anonymous as this can affect her job, and she is worried about backlash for discussing her story.
Shawna Blevins said that she often had to prove her information and realized another person got unemployment benefits easily without having to prove her identity. She became unemployed in March 2020 and waited nine months to get back money. She had worked both in Nevada and Arizona and got PUA benefits from Nevada and regular unemployment benefits from Arizona.
The state supervisor told Blevins that Arizona will pay for half of her unemployment benefits and Nevada would pay the other half. Moreover, there was a lot of going back and forth, for a few months before Blevins got her unemployment benefits. She got her payment from Arizona from January to July 4th and Nevada paid July 4th to December 26th, 2020. After receiving the payment, she had issues with Bank of America, and said they were getting her for fraud. Ms. Blevins in return asked the bank why they would be getting her for fraud and they stated it was because she was receiving benefits from two different states. Ms. Blevins sent the bank paperwork and the phone number to the judicator, so the lady in the bank took care of that herself. However, Ms. Blevins had a hard time getting her account back open because of that.
Belvins also said that there is a shortage of people able to work, so it takes a long time to take care of this situation.
DES Unemployment Fraud
The Arizona Department of Economic Security is combating fraud by using ID.me, a software program that helps and secures digital identity verifications. As many as 100,000 claims have been filed in the last two weeks and the certainty of fraud is high.
On the DES website they have stated that these criminals are using phishing scams, breaches from corporations that have occurred in the past, telephone calls, mail theft, and other tactics as well can be a factor used to collect information from individuals in various parts of the country and file for Unemployment Insurance (UI) and Pandemic Unemployment Assistance (PUA) benefits.
In June of 2020, the Department of Economic Security announced it was strengthening its fraud detection and prevention measures as fraudulent unemployment benefit assistance activity increased nationwide. In response to the surge in fraudulent activity across the nation, the Department began to implement numerous fraud indicators on unemployment claims to safeguard taxpayer funds while ensuring eligible individuals received critical assistance. Efforts to combat fraud presently include cross matches with credible sources to verify identity, the expansion of queries to flag potentially suspicious claims, and the adoption of nationally recommended fraud detection strategies that analyze inconsistencies in both physical and IP address information, according to Brett Bezio.
Bezio, DES spokesperson, has said, “Like most states, Arizona saw a surge of fraudulent Pandemic Unemployment Assistance (PUA) claims in the spring of 2020 and then again in late summer 2020. We became the first, and for several weeks, the only, state in the nation paying Lost Wages Assistance enhanced benefits.”
He continued, “Although there has not been a breach of information stored by DES, fraudsters are using phishing scams, previous corporate data breaches and other tactics to collect information from individuals across the country and file for Unemployment Insurance (UI) and PUA benefits. Prior to the pandemic, an average of 800 reports of suspected fraud were received per month by DES. In comparison, nearly 95,000 cases of suspected fraud have been reported to DES since March 1, 2020. This has skyrocketed the monthly average tenfold to more than 8,600.” , Bezio said.
Investigation
To expand our capacity to understand the patterns and trends among claims flagged for suspected fraud, DES engaged data analytics companies, including Google Analytics and most recently, On Point Technology. These tools have allowed the Department to identify eligible claimants and make appropriate payments while also ferreting out fraudulent claims. We continue to work with our data analytics partners to further protect our systems. Google Analytics, in a collaborative effort with DES, created a preliminary fraud scoring model by applying clean data to a neutral — or “learning” — analysis engine to examine the data for fraud patterns that could not be done as effectively or efficiently with human resources. Arizona was the first state in the nation to engage in this work with Google, according to Bezio.
Since October 12, 2020, DES has been using an identity verification process through ID.me for initial PUA claims to help identify fraudulent claimants and ensure legitimate PUA claimants receive benefits in a secure and timely manner. As a result, there has been a significant decrease in suspected fraudulent initial claims, said Bezio.
On December 4, 2020, DES expanded the utilization for the ID.me identity verification to the entire PUA population who continue to file weekly certifications for benefits. This requirement allows DES to provide PUA benefits to legitimate claimants faster, to further ferret out fraud among the millions of fraudulent PUA claims we have received, and to prevent additional fraudulent weekly certifications. Based on multiple assessments, we expect to prevent over $15 million in fraudulent benefit payments each week by implementing this step at current benefit levels, according to Bezios.
“Fraud detection measures and identity verification through ID.me have helped to combat fraud within PUA, and we added identity verification to the UI system when it became clear that fraud was rising within this program. This work has both reduced the number of fraudulent claims received and allowed us to identify individuals with unique circumstances that need an eligibility disposition on their claim. While there are individuals with unique circumstances whose claims may have been flagged for potential,” said Bezi
The State of Arizona and DES are diligently working and doing their best to provide benefits to those who need it as well as detect fraudulent cases.. Now that they have implemented ID.me, the fraud cases have decreased due to the fact that people have to enter their information and provide an ID or Driver’s License. Once the person is verified, it takes the individual to their account to check their status, or file their regular weekly claims.
