Personal Finance

Scammers are defrauding unemployed Americans

Key Points
  • Roughly 22 million Americans have filed for unemployment benefits in the four weeks through April 11, shattering previous records. 
  • Con artists are trying to take advantage of the surge in claims by posing as individuals helping people file for unemployment and then stealing personal information. 
  • You don't need to pay anyone to file or qualify for unemployment benefits, the Labor Department said Thursday in a fraud alert.
A view of new York State Department of labor office in Flushing Queens during coronavirus pandemic on April 12, 2020. (Photo by John Nacion/NurPhoto via Getty Images)
NurPhoto

Americans are filing for unemployment benefits in record numbers, and scammers are trying to cash in.

Fraudsters are swarming to take advantage of the health and economic crises caused by the coronavirus.

Amid the schemes is one in which scammers offer to help individuals file for unemployment insurance benefits, the U.S. Department of Labor's Office of Inspector General said Thursday in a fraud alert.

The report comes as roughly 22 million Americans filed for unemployment benefits in the four weeks through April 11, according to Labor Department figures issued Thursday morning.

That nearly erases the 22.4 million jobs added to payrolls since November 2009, when the U.S. economy began emerging from the Great Recession.

Con artists are seizing on the pandemonium of people rushing to file for unemployment benefits. The volume surge, which has shattered previous records, has clogged up phone lines and websites of unemployment offices around the country.

Fraudsters posing as a helpful resource for filing unemployment claims typically ask unsuspecting victims for personal information such as Social Security numbers and dates of birth, according to Labor Department's fraud alert.

They also ask people to provide payment or credit-card information to allegedly assist them in filing or qualifying for their unemployment benefits.

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Around 22 million Americans have lost jobs in the last four weeks

"You do not need to pay anyone to file or qualify for your benefits," according to the alert. "Victims of these scams face potential harm."

Fraudsters may use an individual's personal information to commit identity theft by filing fraudulent unemployment insurance claims, the alert said – potentially delaying a victim's payment or edging them out of benefits.

The $2.2 trillion coronavirus stimulus package enacted last month significantly expanded unemployment benefits for jobless Americans, by boosting weekly payments, increasing their duration and swelling the ranks of unemployed who qualify for payments. 

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Americans have lost $13.4 million to coronavirus-related fraud since the beginning of the year, according to the Federal Trade Commission. The true dollar figure could be much higher, since not all consumers may have reported fraud to the agency. 

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