With new unemployment claims reaching an estimated 40 million through the first 10 weeks of the COVID-19 crisis, a sophisticated criminal ring has targeted overwhelmed state unemployment programs with a new financial scam.
According to Krebs On Security, the U.S. Secret Service is investigating a “massive fraud” against a number of state unemployment systems, resulting in potentially millions of dollars in losses. A well-organized international criminal ring is submitting fraudulent state unemployment claims on behalf of U.S. citizens that are still employed.
Much of the activity is occurring in Washington State, Michigan, Mississippi, and Texas, although it is rapidly spreading to other states. According to an instant poll conducted during CO-OP’s monthly FraudBuzz webinar, over a third of respondents reported they have started seeing state unemployment scams impacting their credit union.
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