August 24, 2020
UNEMPLOYMENT SCAMS

The presence of unemployment-related scams has
grown in the wake of the coronavirus (COVID-19)
pandemic. Current unemployment scams include
both fraudulent claims and unemployment-related
phishing attempts. As many individuals are currently
dealing with the reality of a high amount of
unemployment claims, organizations can take steps
to prepare for fraudulent activity and to accurately
identify legitimate requests. By taking proactive
steps and preventive measures, your organization
can be best prepared to identify and, if necessary,
respond to fraudulent activity.

THE PRESENCE OF SCAMS
According to the U.S. Federal Trade Commission
(FTC), scammers often file fraudulent unemployment claims, sometimes even for people who are not unemployed. And, unfortunately, many scams are not revealed until it is too late. Many scam artists may not even be located in the United States. With the coronavirus pandemic leading to unemployment rates as high as they’ve been since the economic crash in 2008, more unemployment claims are being processed than ever before. Scammers seek opportunity, and this niche has received enough attention to warrant a fraud alert from the FTC.

HOW SCAMS HAPPEN
Unemployment-related scams can happen to a
current or former employee - regardless of an
employee’s role at an organization. While scams
were also present pre-coronavirus, current
unemployment scams primarily fall under the
following categories:

  • Fraudulent unemployment benefit claims - These are false claims filed using the personal information of an employed individual. This type of scam can allow a scammer to receive someone else's falsified unemployment benefits.
  • Phishing attempts - These are generally come in the form of emails sent with the intent of tricking people into giving away personal information. This may allow scammers to:
  • File fraudulent unemployment claims.
  • Change bank account information on legitimate unemployment claims.
  • Steal additional personal information.

Individuals should be prepared to identify these
types of fraudulent activities. By reviewing emails with caution and preparing appropriate scam responses, individuals can be better prepared for attempted fraud.
PREVENTING SCAMS
Individuals and organizations can take certain steps, such as the following to prevent fraudulent activities:

  • Educate yourself on how to identify phishing attempts - By building awareness of how to identify scams, individuals can help prevent fraud.
  • Review cybersecurity best practices - The FTC provides guidance, including a guide for small businesses, that organizations can use to help determine the best steps to take in their own organizations.
  • As an organization, communicate effectively with employees - While strong practices, education and training sessions can help prepare your workforce to prevent scams, employee buy-in will be key to effectively preventing fraudulent activity. Ensure education and communication regarding scams are ongoing initiatives so that employees remain up to date on how to help prevent scams.

Individuals should be aware that there has been falsified information about unemployment scams being shared on the internet. Federal agencies, including the FTC, generally provide the most accurate and up-to-date resources.

Organizations can take steps to prevent fraudulent activities—appropriate efforts will vary due to unique aspects of your workplace, but proactive measures such as increased awareness can be an effective first line of defense.
IDENTIFYING SCAMS
Government agencies and state representatives have standardized forms of messaging, which can be recognized by going through proper steps. According to a fraud alert issued by the DOL, the intent of phishing scammers is to have email recipients log in to an illicit account that impersonates the users’ personal accounts in order to steal various account
numbers, passwords and Social Security numbers.

Here are key points that individuals should consider when receiving emails or evaluating unemployment-related internal practices:

  • Hover on and review links, but don’t click - By moving a mouse cursor over a link, you’ll be able to see the link without clicking and going to a potentially fraudulent site.
  • Know that state workforce agencies do not use secondary accounts - Real government agencies do not ask users to log in to external sites and will only ask for an email address if you are creating a user account on their websites.
  • Avoid following emailed directions to log in to a personal account - Common sites for which scammers have requested personal logins include Google, Microsoft, Apple and more. By logging in to what looks like one of these accounts, you may be providing your personal information, including a password, to scammers.

RESPONDING TO A SCAM
While individuals hope to avoid being victims of a scam in the first place, a timely and well-planned response can minimize damage and sometimes even prevent future fraudulent activity after a scam attempt does occur.

The FTC offers the following steps for how to respond to a scam attempt:
  • As an organization, alert your workforce - Alert your employees that a scam has taken place and remind them of the need to be cautious. Ensure that employees know where to direct any notice from an entity claiming to be a government agency. This may be to a specified resource, such as IT.
  • Report the fraud - Best practices for reporting fraud vary by state, so check your state unemployment agency’s website for the correct instructions.
  • Retrain on what to look for - By investing in additional education on relevant scams, you may be able to continue to help their teams look out for common scams.
  • As an organization, refer affected employees to identitytheft.gov - By reporting any fraudulent activity, including any identity theft, victims can get step-by-step help and the resources they need.
  • Ensure you are aware of cybersecurity best practices - Effective cyber protection measures require buy-in from employees. Ensure you are aware of how they can help prevent fraudulent activity.

PROTECTING YOURSELF
No one is immune to the threat of scams, and now is as good a time as ever to ensure you are taking adequate steps to both prevent and respond to any fraudulent activity. Individuals should continue to follow guidance from the FTC and consult with local legal counsel when updating or changing policies. For additional resources, contact ACBI Insurance.