Voice of the consumer: Unemployment fraud; IRS letter on stimulus payment

Jenna Middaugh
Jenna Middaugh(KKTV)
Published: Oct. 5, 2020 at 7:37 AM MDT
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Our 11 News Call For Action team pens a weekly column for our news partner The Gazette. Previous columns can be found here.

COLORADO SPRINGS, Colo. (KKTV) - The Colorado Department of Labor and Employment (CDLE) has stopped millions, if not billions, of dollars in fraudulent unemployment benefits since the pandemic began.

A few weeks ago, I told you how people were receiving U.S. Bank ReliaCards, which is how the state pays out some benefits, even though they never applied for unemployment. CDLE said this is one indication of fraud.

Fraudsters are also taking advantage of Pandemic Unemployment Assistance, known as PUA. According to the U.S. Department of Labor, this federal program provides up to 39 weeks of benefits to people who are not eligible for regular unemployment.

Cher Roybal Haavind, CDLE’s deputy executive director and chief communications officer, said PUA has seen very large instances of fraud across the country because it has fewer wage verification measures compared to other unemployment programs.

“Just nationally, it’s just presented an opportunity for criminals to take advantage of a program that doesn’t have a lot of safety measures in place,” Haavind said.

To make up for that, CDLE said it has put 18 fraud triggers into place to flag when someone tries to take advantage of the system. The system was able to detect nearly 50,000 falsified PUA claims that were filed between July 18 and Aug. 22. In total, CDLE said the fraud triggers have been able to prevent between $750 million and over $1 billion in unemployment payments from being paid out. The CDLE would not elaborate on what the fraud triggers are.

“To talk about it at any level of depth would just provide another mechanism for the fraudsters to know what we’re doing and the means to work around that,” said Jeff Fitzgerald, the division director for unemployment insurance.

Since this fraud is such a widespread issue, CDLE said the U.S. Department of Labor has made $100 million in funding available to help states bolster their fraud detection and prevention efforts. Haavind said Colorado plans to apply for $2.4 million of that funding.

I also want to let you know that some people will be receiving a letter from the IRS. For those of you who don’t usually file a tax return or did not file a return for 2018 or 2019, you might not know that you could qualify for an economic impact payment. According to the Federal Trade Commission, 9 million people will be getting a letter from the IRS letting them know how to register on its website to claim the payment by Oct. 15.

The FTC wants to make sure people don’t think this letter is a scam. If you get a letter, go to the IRS’s website at IRS.gov/EIP or call 800-919-9835.

If someone calls, emails or texts you claiming to be from the IRS, that’s a red flag. The IRS never contacts people that way. If you answer, hang up, and never click any links through email or text.

Remember, you can always report scams, fraud and price gouging to the Colorado Attorney General’s Office. The consumer hotline number is 800-222-4444.

Click here to read the original column on gazette.com.

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