DENVER (AP) — Colorado Attorney General Phil Weiser is announcing a statewide campaign to identify and prosecute persons responsible for an estimated 1 million-plus fraudulent claims for unemployment benefits during the coronavirus pandemic.
Weiser says the effort will involve his office, the Colorado Bureau of Investigation, the state labor department and district attorneys across the state. A formal announcement was due Thursday.
“The amount of fraud that we’ve seen around this unemployment insurance is staggering,” Weiser tells Colorado Public Radio. “We want to hold people accountable. And to do so, we need a team.”
Fraudulent claims nationwide have victimized millions of people, including legitimate applicants and unsuspecting victims of identity fraud. Scammers use stolen personal information such as Social Security numbers or birthdays to apply for unemployment benefits. The Colorado Department of Labor and Employment has flagged more than 1 million claims as fraudulent.
Estimates of fraudulent payments range from $6.5 million in Colorado to $11 billion in California, the biggest target. Other estimates, according to AP reporting across the states, range from several hundred thousand dollars in smaller states such as Alaska and Wyoming to hundreds of millions in more populous states such as Massachusetts and Ohio.
Colorado fraud victims can report cases to the department and to Weiser’s office at stopfraudcolorado.gov.
The labor department’s efforts to identify hundreds of thousands of benefit accounts as potentially fraudulent has affected legitimate unemployed applicants as well. The department is using automated software to detect suspect claims.
The U.S. Department of Labor warned states in September about “criminal enterprises and other bad actors deploying advanced technologies, stolen or synthetic identities, and other sophisticated tactics,” according to a memo obtained by CPR News through a public records request.
Fraud networks based outside Colorado will be referred to federal prosecutors through the U.S. Attorney’s Office. The U.S. Justice Department is investigating unemployment fraud by transnational and domestic criminal organizations, according to Joshua Stueve, a spokesman for the department’s criminal division.
States hardest hit are those, like Colorado, participating in the Pandemic Unemployment Assistance program adopted by Congress last year. The program helps unemployed freelancers and gig workers who normally don’t qualify for unemployment insurance.