WRAL Investigates

WRAL reporters targeted in unemployment scam; state promises changes

Posted December 14, 2020 5:45 p.m. EST
Updated December 14, 2020 7:19 p.m. EST

— Unemployment fraud is a serious problem, one that has impacted thousands this year, including 5 On Your Side’s Monica Laliberte and WRAL’s Brian Shrader. Both recently had scammers file for unemployment in their names.

Their experience dealing with the fraud raised serious concerns and a push for answers.

"If two people in the same company this happened to within a couple of weeks of each other, just imagine across the state, the scale at which this is happening," Shrader said.

Since March, the NC Division of Employment Security Commission paid out $11 million in fraudulent, ID theft-related claims.

While victims will probably never know for sure, often, a prior data breach likely put personal information out there: birth dates, addresses and social security numbers.

"I’m upset that it happened to me because I have done all the right stuff," Shrader said.

He had a credit freeze in place, but that doesn’t help with a fraudulent unemployment claim.

"It seems like every time we put a tool in place to help prevent fraud and identity theft, the criminals find a way to work around, and we ended up having to add another layer," said Pryor Gibson, head of the North Carolina Division of Employment Security.

Laliberte asked him about the letters she and Shrader got from DES with the headline: Wage Transcript and Monetary Determination.

"There’s nothing anywhere in either of these letters to tell me what to do if I think it’s not accurate or especially if I think it’s fraud," said Laliberte.

"I hear you," said Gibson.

"I thought maybe because of the CARES Act, and with so many people filing for unemployment, maybe this was just a statement of, here are your potential benefits, if you do need to file for unemployment," Shrader said. "I thought it was just kind of junk mail, and I threw it away."

In Shrader’s defense, a line in the letter refers to it as "an explanation of potential benefits."

It includes information "on how to protest the benefit amount, "discrimination concerns," and even "important information about registering for work."

But nothing indicates money is about to be, or in Shrader’s case, is already being paid in his name.

"I didn’t see anything on there that caught my attention that said this would be a problem, that something is up," he said.

Gibson told Laliberte the letter is directed to help those in need, not to sound alarms about fraud.

Still, he plans to make a change.

"I would argue that it is maybe a good thing to put a statement in there that’s, in the event that you don’t deserve these benefits, you should call the fraud hotline number," said Gibson. "We’ll look at drafting a message that makes it clear."

A letter from DES will alert you if there’s a potential issue.

Laliberte also shared concerns that she and Shrader experienced when they called the DES Fraud Hotline, even after they’d already filed fraud reports with DES online.

"Based on my interaction, I have absolutely no confidence that the person even understood what was going on," Shrader said.

Both say they were questioned as if they were asking for benefits.

"You know, where did I work, how much did I make and all of this stuff, and I said, `no, no, no, no, no,’" Shrader said.

Gibson said, "if that’s what happened, then that’s a shortcoming."

"Do we need people better trained and in a better position to help solve this? Absolutely. And that’s what we’ve been working on non-stop for the last six months," said Gibson.

DES fraud investigators have flagged 28,300 cases since March, part of the nationwide spike reported by the FBI.

But perhaps the biggest concern 5 On Your Side addressed with DES, is that Shrader’s claim was paid even before his employer, Capitol Broadcasting, got notice of it.

"I was shocked that they were getting paid," Shrader said. "I don’t understand how that could have happened. Where’s the verification?"

"It’s serious, it’s complicated, and it’s incredibly urgent," said Gibson.

Gibson says fraud happens despite a "litany" of detection and verification efforts.

"It ranges everywhere from addresses that are suspicious, phone numbers that might’ve been used that are repetitive," said Gibson.

They even flag IP and email addresses that appear similar.

Who’s behind the fraud?

"Sometimes it’s individuals, sometimes it appears to be professionals, but every time it happens, it’s devastating to the individual," said Gibson.

He adds a huge number of claims, skillful scammers and a push to get benefits to the people who need them complicate matters.

"Every time we turn the dial to prevent fraud, we diminish the ability to get a payment out quickly," said Gibson. "It’s a balancing act that sometimes we don’t get completely right, but we sure work on it every day."

Now, as with any identity theft, Shrader and Laliberte must work to protect their personal information.

Victims should report the fraud to DES, the Federal Trade Commission, and freeze their credit.

To nip ID theft in the bud, check credit reports regularly. Get a free report from annual credit report.com.

And know, scammers usually get unemployment payments deposited into their accounts.

Sometimes, as happened to Shrader, the benefit debit card was sent to his address.

The FTC warns it’s called a money mule scam.

The fraudsters may call, text or email to get you to send them the money. Sometimes they claim to work with the government and the payment was a mistake that needs to be sent back.

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