IWD director: Hundreds of potential ID theft cases claiming unemployment insurance benefits under investigation

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Iowa Workforce Development has identified nearly $3 million in attempted fraudulent unemployment insurance claims, as well as hundreds of claims made using another’s identity during the pandemic, IWD Director Beth Townsend said last week. She provided the figures during a virtual panel discussion hosted by the National Consumers League. “What we’re seeing primarily at IWD [related to fraud] is identity theft — individuals claiming benefits in someone else’s name,” Townsend said. Since mid-March, the department has identified 271 claims that were filed using a false identity, and is currently investigating more than 400 additional cases of potential fraud. About $57,000 in unemployment benefits were fraudulently claimed and paid out in the cases that have been identified so far, she said. “On the upside, we’ve been able to prevent over $2.8 million in claims that were being made by people who are not otherwise entitled to benefits,” she said. “So an active part of what we’re trying to do is catch them before it’s paid, because it’s way easier to stop the money going out than to collect it back.” Individuals who claim benefits they weren’t eligible for — including those who return to work but don’t report it — will not only have to repay the full amount, but will also be ineligible to file for unemployment in the future until the debt is paid and may be subject to having their federal and state income tax refunds taken, she said. With the unemployment rate currently at 10%, the most recent weekly unemployment payments totaled more than $38 million.