DES Issues Fraud Alert to Arizona Consumers, Announces Law Enforcement Task Force to Combat Criminal Activity (October 2, 2020)
Summary
The Arizona Department of Economic Security warned consumers on October 2, 2020 of a new unemployment-benefits fraud and announced a joint task force with law enforcement. DES says that since March it has issued over $11.4 billion in assistance to 1.6 million claimants, and that it received over 660,000 PUA claims in the last two weeks alone. Criminals were entering randomly selected in-state addresses, so residents were receiving notices and benefit cards in the names of people who do not live there; in most cases payment was blocked and the cards carry no funds. The DES Office of the Inspector General task force includes the Arizona Department of Public Safety, the Maricopa County Sheriff's Office and the Arizona Attorney General's Office. People who receive such cards are told to report them to DES online or by phone and to destroy the cards.
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DES Issues Fraud Alert to Arizona Consumers, Announces
Law Enforcement Task Force to Combat Criminal Activity
PHOENIX – (October 2, 2020) The Arizona Department of Economic Security (DES) is
warning consumers of a new fraud scheme targeting unemployment benefits and today
announced a new joint task force with law enforcement to combat high levels of unemployment
fraud. These are the latest steps in DES’s aggressive approach to preventing fraud and
protecting taxpayer dollars while ensuring Arizonans in need can access benefits.
Arizona and states across the nation continue to see an extraordinary number of claims filed as
a result of identity theft. In this current phase of fraudulent activity, criminals are taking
advantage of the federal program by inputting randomly selected, in-state addresses to bypass
fraud identifiers.
Since March, DES has issued over $11.4 billion in assistance to 1.6 million claimants. At the
same time the Department has worked to safeguard taxpayer dollars and ensure only eligible
claimants receive assistance.
DES has become aware that some Arizona residents are receiving notices and benefit cards at
their address with the names of individuals who do not reside at that location. In most
instances, payment was blocked due to fraud prevention measures implemented by DES and
there are no funds loaded on the cards. The Department has received over 660,000 PUA claims
in the last two weeks alone, indicating a high number of fraudulent claims being filed. DES is
close to implementing a robust front-end identity check to prevent fraud while making it faster
and easier for legitimate applicants to claim their benefits.
Steps DES is Taking to Combat Fraud
The Department has been working closely with data analytics companies, financial institutions,
and state and federal partners to review claims and identify those eligible for benefits, as well
as those with a high probability of fraud. This involves identifying patterns and trends among
claim data and claimant behavior and cross-matching information to ferret out criminal activity.
To build upon these efforts, the DES Office of the Inspector General (OIG) has launched a task
force comprised of federal, state, and local agencies, including the Arizona Department of Public
Safety, the Maricopa County Sheriff’s Office, the Arizona Attorney General’s Office and other law
enforcement agencies to investigate large-scale, organized unemployment insurance fraud in
Arizona. This task force formalizes an existing, ongoing partnership with law enforcement
agencies at all levels investigating unemployment fraud during the COVID-19 pandemic. The
task force will focus on criminal activity within Arizona, and DES will continue to work with the
FBI and Secret Service in combating fraud on a national level.
The task force will identify suspects and co-conspirators perpetrating fraud schemes, investigate
the network of criminals behind the fraudulent claims and work to prosecute these criminals.
The formation of the task force will combine a wide array of resources and law enforcement
experience to combat the increase in illegal activity.
What to Do When You Suspect Unemployment Fraud
Individuals who receive notices and benefit cards from DES but did not apply for benefits are
instructed to report this online at bit.ly/ReportAZUIFraud or by calling 1 (800) 251-2436. The
webform is available in English and Spanish. When reporting fraud, individuals should provide
identifying information in the web form that will help locate the claim in our systems. This
includes full name (as it appears on the documents received from the UI program), mailing
address where the documents were received, and SSN (when documents are received in the
individual’s name). Individuals are advised to destroy cards they erroneously received. Once
DES is able to locate the fraudulent claim, we can take appropriate action and do not need the
card returned.
Individuals who receive notification of unemployment assistance benefits in their name for
which they did not apply may be the victim of identity theft for those who seek to obtain
fraudulent benefits. If an individual believes they were the victim of identity theft, they should
report it to DES online at bit.ly/ReportAZUIFraud or by calling 1 (800) 251-2436. We also
encourage them to go to the Federal Trade Commission (FTC) identity theft website,
identitytheft.gov, to report and protect themselves from further victimization. They are also
advised to monitor their credit report for any other fraudulent activity that may come as a result
of identity theft. Individuals can learn more about protecting themselves from Unemployment
Insurance Fraud in this Unemployment Insurance Consumer Protection Guide issued by the U.S.
Department of Justice National Unemployment Insurance Fraud Task Force.
More information regarding unemployment fraud can be found here. To report fraud, file a
report online or call the DES Fraud Hotline at 1 (800) 251-2436. The webform is available in
English and Spanish. After reporting fraud to DES, file a report with local law enforcement.
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