No, Your CEO Did Not Really File For Unemployment Benefits

By Alexander Castelli - Shawe Rosenthal LLP

July 9, 2020

We just got a call from a client who was notified by the state of a claim for unemployment benefits for one of their employees. Actually, their CEO. Who is still employed. And who therefore had not filed a claim for benefits. Unfortunately, they were the victims of a scam involving fraudulent unemployment benefits claims.

According to the U.S. Federal Trade Commission, scammers are filing claims for benefits using the names and personal information of people who are not, in fact, unemployed. The FTC states that by the time that most people learn they have been affected – after they receive a notice from their state unemployment benefits office or their employer about their purported application for benefits – the benefits usually have already been paid to an account that the scammers control.

The FTC recommends that employers inform their employees about the existence of this scam and ask them to report any fraudulent benefits claims to the human resources department as soon as possible. Employers should also immediately notify the employee about any suspicious claim. In addition, employers should report the fraud to their state unemployment benefits agency, and affected employees can report the identity theft to the FTC at identitytheft.gov to get recovery help.

Relatedly, the Office of Inspector General for the U.S. Department of Labor also recently issued an Unemployment Insurance Phishing fraud alert involving scammers sending phishing emails to trick people into giving them their personal information. The phishing emails, which may purport to be from a state workforce agency, contain links that send the victims to a webpage which looks like a Microsoft SharePoint Website. The link requires the victim to sign-in using a Google, Microsoft, Apple, Yahoo!, or other user account. Once signed in, the scammers will have the person’s username and password and access to any personal information stored in the account. Then, according to the OIG, “[t]he scammers may use your personal information to collect unemployment insurance in your name or change your bank account number to one of their own.” The fraud alert emphasizes that no state workforce agency requires people to use a secondary account to sign into their system, but instead require people to create a user account with their website.