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Fake Unemployment Benefit Websites Preying On Laid-Off Workers, Experts Warn

New IdentityTheft Scam

Unemployment benefits have been a lifeline for many Americans laid off during the pandemic. Unfortunately, con artists have been busy pillaging these funds – often with the help of workers’ own computers and cell phones.

Americans have lost $63 billion nationwide of unemployment funds during the pandemic to improper payments and fraud (mostly the latter), according to February 2021 data from a watchdog for the U.S. Department of Labor. Increasingly, these scams are carried out through sham unemployment websites and ‘phishing’ emails from scammers bent on identity theft, according to Tim Sadler, the co-founder and CEO of Tessian, an email security firm which features a form of artificial intelligence that enables systems to learn from data.

“These scams prey on people who are vulnerable, out of work, and urgently looking for relief, so they may be applying a little less scrutiny than usual,” Sadler said.

This March, the Federal Trade Commission warned of this new development in a press release. “At a time when many people left jobless by the pandemic are struggling to get by, scammers reportedly are using websites that mimic government unemployment insurance benefits websites,” said Seena Gressin, an attorney in the FTC’s Division of Consumer & Business Education. “These sites trick people into thinking they’re applying for UI benefits, and they wind up giving the scammers their personal information.”

And in case you’re wondering how jobless Americans run across these fake websites in the first place, both Sadler and Gressin put the blame on spam ‘phishing’ emails and texts.

The Department of Justice’s National Unemployment Insurance Fraud Task Force reports that scammers lure people to their fake websites by sending spam text messages and emails,” Gressin said. “The messages look like they’re from a state workforce agency [SWA] and give people links to these fake sites. When people enter their sensitive personal information on the fake sites, the scammers can use the information for identity theft.”

Worse, such scams may be on the rise. Tessian’s threat intelligence team recently discovered a set of email patterns that suggest a nationwide surge in both attempted unemployment and medical fraud:

  • During the week of February 24 –in which the third round of stimulus checks was announced – the number of suspicious unemployment and Covid-19 related emails was 40% higher than the weekly average detected since the start of 2021, according to the Tessian team. 
  • The number of unemployment-related emails alone was 16% higher than the weekly average.
  • During the week of March 8, the number of suspicious unemployment- and COVID-19-related emails was 51% higher than the weekly average.
  • The number of unemployment and COVID-19 related emails detected during the week of March 8 was 69% higher than the previous week. 

What can people depending on unemployment benefits do to avoid this onslaught of unemployment scams?

“Here’s what you need to know: An SWA will not contact you out of the blue,” Gressin said. “State workforce agencies will not send a text message or email inviting you to apply for UI benefits.” If you get an unsolicited text or email message that looks like it’s from an SWA, she said, here are some steps to take to protect yourself:

  • Never click links in an unexpected text message or email claiming to be from an SWA.
  • If you have applied for UI benefits and get a text or email about your application, contact your SWA directly using contact information from its official website.
  • If you need to apply for UI benefits, use this link to find your state’s UI application page. Follow the directions you find there.
  • If you gave someone your sensitive information, visit IdentityTheft.gov/unemploymentinsurance to learn how to protect your credit from scammers or, if necessary, report that someone has misused your personal information to claim UI benefits.

You may want to take several additional steps to avoid these and other scams, says Sadler, whose company uses artificial intelligence to detect patterns in legitimate and potentially fraudulent emails and to automatically block potential threats.

Besides considering an email security system at home or work, Sadler said, “It’s important for people to employ two-factor authentication and to not use the same password across different sites — those are two of the best steps you can take” for better online security. He also suggests getting a password manager, such as RoboForm, 1Password, Keeper, Norton, or a similar tool that can generate your passwords, distribute them across multiple sites, and protect them with encryption software to guard against hackers.

Don’t automatically trust an email asking for private information even if the email address looks legitimate, he added. “People may be trained to look out for [bizarre requests],” Sadler said, “and they may be on alert if the email address is unfamiliar. But sometimes the email account itself is compromised, and the phishing email is using a falsified IP address… If you’re unsure, you can verify the legitimacy of the sender by calling the organization directly.”

He also advises you not to open attachments in email. “Attackers have started using social engineering techniques such as hiding keywords in raw HTML or sending invisible pixels,” he said. “From there, bad actors can lure someone into entering their credentials online and then steal sensitive identity information or wire money to fraudulent accounts.”

Besides phishing emails and fake UI websites, confidential unemployment information has been looted in ransomware schemes by cyberhackers who broke into Accellion, a 20-year-old third-party vendor used to securely transfer files. In Washington, the state auditor’s office has reported that information on nearly 1.5 million unemployment applicants had been stolen, according to an ABC News report. Unemployment fraud has also been linked to previous high-profile data breaches, such as the 2017 Equifax
EFX
EFX
breach, in which millions of social security numbers became available for sale on the dark web, according to the cybersecurity firm LMG Security.

In some cases, you may become aware your information has been stolen only when a fake unemployment claim shows up on your tax return (See Brett Holzhauer’s Forbes story, “Unemployment benefits fraud: What to know and how to protect yourself”). Or, you may find out when your own unemployment benefits are stolen. Holzhauer points out that you will not be liable for any stolen benefits, but that the process can take an excruciatingly long time to resolve. If you do find out that someone has filed a false claim in your name, you will need to be your own advocate and take steps to prevent such fraud from happening again (See Jeff Bell’s Forbes story on fake unemployment claims and what to do about them.)

No matter how unemployment frauds occur, the human toll is enormous. This hit home recently when my husband, whose employer shut down during the pandemic, went to his bank in Berkeley, Calif., to withdraw some of his unemployment funds to go grocery shopping. He had recently moved all the money on his unemployment insurance card to the bank, but when he used his UI card at the ATM to access his account, he was stunned to find that nearly all his money had vanished.

Upon investigation, the bank determined that the funds had been withdrawn by someone using a different card from a bank in Daly City, a suburb on the other side of the San Francisco Bay. The bank and the California Employment Development Department opened a fraud investigation, and my husband opted to receive future UI benefits by mail for better security. However, he was not reimbursed for any of the money he lost, and many weeks later, it is still unclear when that will happen.

Source: on 2021-04-04 14:22:30

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