Like states all across the country, Kansas is seeing an increase in reports of unemployment claim fraud due to identify theft. Fraudulent claims are being filed using the names and personal information of people who have not lost their jobs. People are often unaware a claim has been made on their behalf until they receive a determination notice in the mail from KDOL or until their employer receives a notice to verify the employee’s status.
The Kansas Department of Labor has a special Fraud Investigations unit that handles all allegations of Fraud. The group’s purpose is to detect, investigate and prosecute, if necessary, incorrect payments of UI benefits. Most leads come from a quarterly cross-match of audits sent to employers. The audit checks for claimants who received benefits in the same quarter they also received wages reported by an employer. We also use the national and state directory of new hires to check for those collecting benefits after starting a new job.
A review of fraudulent claims due to identity theft indicates that scammers are finding personal information through incidents like credit card data breaches and then using that information to illegally attempt to collect unemployment. These fraudulent attempts are not due to a breach of the KDOL unemployment system or because of anything that you have done. Furthermore, receiving a letter of determination does not mean that benefits were paid; only that a claim was filed with your information.
Unemployment fraud is a felony. It is the willful misrepresentation of information to collect unemployment benefits. Misrepresentation of information includes making false statements or withholding material information. Someone found to have committed fraud is disqualified from receiving any unemployment benefits for a period of 1 year if first offense and 5 years if it is a second offense. This denial period will not start until the overpayment created by the fraud has been paid back in full.
Tips from the public are a great source of information in catching fraudulent activity. If you believe someone is fraudulently collecting unemployment benefits, please report it immediately to our Fraud Investigations unit at the website below. All allegations of fraud are investigated.
After submitting a Fraud Report, you will receive an e-mail confirmation. Please be assured, an e-mail confirmation ensures that KDOL will investigate your claim, suspend the fraudulent account if suspicious activity is found and refer the matter over to law enforcement for action – even if you do not hear from KDOL any further.
A fraudulent claim that is created using you or your employee’s personal information, including Social Security Number and date of birth, indicates that personal information is exposed and there is risk of further financial harm. In such cases, we recommend the following steps:
- Contact the Federal Trade Commission
- Place a fraud alert on your credit record with one of the three credit bureaus:
- Contact your financial providers (banks, credit card companies, etc.) to flag irregular transactions.
- Check your Social Security earnings statements online to make sure your reported wages are correct. You can do this with a free, personal my Social Security account
If you did not file a claim for unemployment benefits and believe the 1099-G or Overpayment Notice is a result of your identity being stolen, report the fraudulent claim to KDOL at https://fraudreport.dol.ks.gov/FraudReportSubmit.
After reporting the fraudulent claim, you must also dispute the overpayment resulting from the fraudulent claim. Follow the instructions below:
- Download and complete the Unsworn Declaration of Payments Not Received/Identity Theft Form (K-FRD 100) below.
- Upload the completed form to the KDOL Self-Service Portal.
- On the Self-Service Portal you must agree to the terms of submitting an Unemployment Assistance Request.
- Once you agree, Click on Submit Unemployment Assistance Request
- Under I am an* select Individual and I need to select 1099 Protest/Dispute, press Next
- Fill out the requested information and press Next
- Select My dispute is related to Identity theft. Attach the K-FRD 100 form and press Submit
KDOL’s Unemployment Insurance Tax/Employer division works to prevent, detect and investigate worker misclassification.
Worker misclassification occurs when an employee is incorrectly classified as an independent contractors rather than employees.. Misclassified workers lose essential protections and rights they would otherwise be entitled to in a traditional employee/employer relationship including minimum wage requirements, overtime pay, workers compensation, unemployment insurance and anti-discrimination laws. Intentionally misclassifying workers constitutes tax and insurance evasion and will not be tolerated.