Initial unemployment claims

After sharp rises in late March and early April, initial unemployment claims had been on the downward trend. However, a 28% increase for the week ending June 20 makes the Indiana Department of Workforce Development suspicious of fraudulent claims.

The Indiana Department of Workforce Development said it is putting “holds” on, and investigating, many Pandemic Unemployment Assistance (PUA) claims that have been recently filed before clearing them for payment.

The holds are the result of nationwide increases in identity theft and fraud in unemployment filings, according to an agency news release.

DWD continues to implement additional safeguards to further protect its unemployment insurance system from the threat of fraud, it said.

“We have been monitoring situations in other states, and now similar attempts of fraud are targeting Indiana,” Regina Ashley, DWD’s chief unemployment insurance and workforce solutions officer, said in the release. “DWD is working vigilantly to ensure these attempts to cheat the system are caught and that payments are not falsely distributed.”

For the week ending June 20, initial unemployment claims totaled 31,885, a 28% increase from the previous week, according to DWD. Increases could be due to suspected fraud.

Increases in initial unemployment claims are inconsistent with other employment indicators that initial claims should be decreasing, such as more individuals returning to work in Indiana as it progresses in steps toward reopening certain activities and businesses, and fewer individuals filing for continuous weekly benefits, according to the DWD.

U.S. nonfarm payroll employment rose by 4.8 million in June, and the unemployment rate declined to 11.1%, the U.S. Bureau of Labor Statistics reported July 2. In June, employment in leisure and hospitality rose sharply, according to the agency. The number of unemployed people who were on temporary layoff decreased by 4.8 million in June to 10.6 million, following a decline of 2.7 million in May. The number of those who permanently lost jobs continued to rise, increasing by 588,000 to 2.9 million in June.

Indiana’s unemployment rate for May was a seasonably adjusted 12.3%. The report on June unemployment will be released July 17. The Metropolitan Area report will be released July 29.

Fraud in unemployment claims can range from large international crime rings that steal people’s personal information or identities to file a claim, often using names of employees who are still employed, to employees who continue collecting unemployment even after returning to work, to requests for payments to help process unemployment claims, according to DWD. DWD is working with both federal and state authorities to investigate all suspected fraud.

The scammers may use your personal information to collect unemployment insurance in your name or change your bank account number to one of their own. DWD encourages claimants to protect their personal information, and to only provide requested claims information through the official DWD portal, DWD does NOT require claimants to use a secondary account to sign into its online filing system (Uplink).

Employers should carefully review all documentation from DWD with claimant names. Both claimants and employers should report any suspicious activity.

People who commit unemployment insurance fraud face both civil and criminal penalties which include fines, incarceration, probation, and other penalties.

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