Resources to Protect Against Unemployment Benefits Fraud

Client Alerts / May 2020

As widely reported, COVID-19 and the statewide lockdown resulted in an unprecedented number of unemployment insurance claims. While the vast majority are indeed legitimate, there has been an unfortunate surge in fraudulent claims filed by individuals who are taking advantage of the current situation.

The Employment Security Department (the “ESD”) confirmed that its own system was not breached, but rather suspects that the personal information being used to file illegitimate claims came from some other past breach.

As Washington officials work towards preventing and stopping fraud, fixing any vulnerabilities within the state’s system, and recovering stolen payments, there are a few steps you can advise your employees to take to better protect themselves.

1. Have them visit the ESD’s website (https://secure.esd.wa.gov/) and proactively set up an account. Doing so will alert the employee to any fraudulent claim that might already be associated with their social security number, and also put up a safeguard by preventing bad actors from setting up an account using their personal information in the future.

2. If an employee’s information has already been compromised, they should:

  • report the incident to you and file a fraud claim with the ESD online or by calling 1-800-246-9763;
  • file an online or non-emergency police report and use the police report number to file a report with the Federal Trade Commission;
  • consider setting up an account with the Internal Revenue Service, locking their social security number, freezing their credit, and signing up for a credit monitoring service; and
  • notify the three major credit bureaus (Equifax, TransUnion, and Experian). They can request and review their free credit reports and close any accounts which may have been tampered with.

Finally, as an employer, you should be sure to closely review the notices you receive from the ESD to ensure that claims filed are legitimate.  Although businesses do not have an obligation to report the fraud to the ESD, you can provide your employees an early heads up that a fraudulent claim has been filed. And you can report the fraud to the ESD on behalf of your employees. Here is a link with more information on how to do so: https://esd.wa.gov/unemployment/unemployment-benefits-fraud.

Learning that personal information has been compromised is incredibly stressful. To the extent possible, encourage your employees to remain calm, act quickly, follow the steps above, and utilize the resources made available by each agency. As always, don’t hesitate to contact Cairncross & Hempelmann with questions.