How to Protect Yourself From Unemployment-Benefits Fraud
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Here's your money briefing for Monday, May 3rd. I'm J.R. Whelan for The Wall Street Journal. Over the past year, as unemployment was skyrocketing and millions were applying for jobless benefits, fraudsters saw an opportunity. By posing as someone else, they could siphon money from the system. As a result, many people, even those who never filed for benefits, have gotten a notice saying their personal information was used to tap the system. Among them, our own personal finance reporter.
So really strangely, I got a letter sent by the New York State Labor Department, and they notified me that they strongly suspected that somebody had filed a fraudulent claim for unemployment in my name. And, you know, being fully employed, I obviously didn't file such a claim.
Coming up, Ann Tergesen explains how fraudsters were able to withdraw money in her name, and she'll have some tips on how to prevent this from happening to you. That's after the break.
This podcast is brought to you by ReliaQuest. Cyber criminals are constantly attacking. They want your data. They want your identity. They want your innovation. ReliaQuest fortifies your business with agentic defense, AI that detects, contains, and eliminates cyber threats in minutes. It helps your security team move faster at the work that matters most to protect the business now and delivers insights to help them predict what's next. ReliaQuest, agentic defense for the enterprise. Learn more at ReliaQuest.com. That's R-E-L-I-A-Q-U-E-S-T.com.
Seems like every day we hear about data breaches or personal information getting into the wrong hands. We hope it never happens to us. Well, it's happening to people nationwide.
How did listeners first learn about widespread unemployment‑benefits fraud?
In one kind of scam, personal information is being used to file fraudulent claims for unemployment benefits. This happened to our personal finance reporter, Ann Tergesen, and she's here to tell her story. Ann, thanks for being here. You're welcome. So, Ann, you've been on the show before talking about how some of the ways that people can find themselves wrapped up in different kinds of financial fraud. Did you ever think this would happen to you?
To be honest, I kind of thought it was just a matter of time, and I guess I was right, because I got caught up in this very large unemployment benefits fraud that seems to be pretty widespread. So it's hard to know exactly, but the Labor Department inspector general recently estimated that about 10% of the federal funding allocated for unemployment insurance during the pandemic may have been siphoned off to bad actors due to fraud.
Yeah, they say that adds up to at least $90 billion that could have been improperly paid out. So can you walk us through what happened to you? How did you first learn that your personal information was used like this?
So really strangely, I got a letter sent by the New York State Labor Department that was sent to me actually at my parents' address, which was kind of strange. And they notified me that they strongly suspected that somebody had filed a fraudulent claim for unemployment in my name. And being fully employed, I obviously didn't file such a claim. So I was quite alarmed and realized that it probably was fraud. So that's how I found out about it.
Yeah, you're gainfully employed by the Wall Street Journal and have been for many years. So how do the fraudsters do this? You know, fabricate your employment status to be able to unlock unemployment funds.
Yeah, that's what they do. So sometimes it's through phishing, like the New York State Labor Department says, if you get a text that's purporting to be from us or an email, you basically have to verify that because there are fraudsters out there who will send texts and they will pretend to be from your state unemployment agency or whatever.
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