VIEWpoint Issue 1 | 2020
VIEWpoint Issue 3 | 2019
Contractor’s Revenue Recognition Reminder Checklist
With every natural disaster or large-scale pandemic comes criminals who use the misfortune of others to scam their way into money. Unfortunately, the COVID-19 pandemic is no different. At the beginning of the crisis, unemployment agencies buckled under the unprecedented demand for benefits. At the same time, they were busy implementing a federal coronavirus relief package, increasing benefits to workers and upping weekly payments by $600. This influx in unemployment claims and the urgency to process applications allowed many scammers to fly under the radar with fraudulent applications, causing a spike in unemployment fraud.
In the recent pandemic-related fraud cases, it appears scammers are using stolen Social Security numbers and other private information to secure weekly unemployment benefits. States including Michigan, Washington, Rhode Island, Oklahoma, Pennsylvania, Massachusetts and Florida, among others, saw an uptick in these cases in recent months. In many instances, it appeared the scammers obtained personal information from local first responders, school employees and government personnel to secure these benefits. However, many others have also become victims of the recent unemployment scams.
In lieu of the spike in unemployment fraud reports, many states have stalled some benefits from being disbursed.
For example, Michigan issued a “stop order” in which nearly 340,000 claims (20% of the state’s total) were halted. Applicants are now required to verify their identity online and provide other documents to prove they are eligible. Oklahoma officials indicated there were over 80,000 claims in late May which raised suspicion. Pennsylvania ceased paying checks on nearly 58,000 claims for Pandemic Unemployment Assistance (PUA), a new federal program providing jobless aid for those ineligible for weekly benefits under the CARES Act.
In these times of scammers preying upon vulnerable individuals, it is crucial for your business to stay alert in the event one of your employees is targeted. Since employers receive a notice from unemployment agencies to confirm an employee is eligible for benefits, be sure to pay extra attention to the information being sent to you. Was this employee actually laid off? If not, it could be a scammer attempting to use your employee’s information for their own benefit. Be sure to deny the claim and indicate the reason to the unemployment agency.
You should also notify your employee immediately of the situation at hand, as they have fallen victim to identity theft. If your employees received benefits they didn’t request, they should report it to the state unemployment agency and ask for further instruction.
While officials are tactically concealing their methods to track down scammers, they will likely utilize IP addresses and financial records to identify fraudulent behavior. To keep your employees’ names off their list of victims, warn your team to be wary of any identity theft attempts. Have them keep Social Security numbers and other private information close, staying alert to any trap designed to access this information. If you are concerned about your business being affected by unemployment fraud, contact your state’s unemployment agency.
Doeren Mayhew stands ready to help your business navigate the complexities of operating during a pandemic, contact our professionals today.
This publication is distributed for informational purposes only, with the understanding that Doeren Mayhew is not rendering legal, accounting, or other professional opinions on specific facts for matters, and, accordingly, assumes no liability whatsoever in connection with its use. Should the reader have any questions regarding any of the news articles, it is recommended that a Doeren Mayhew representative be contacted.
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