DOL says it prevented $1B in unemployment claims fraud

ALBANY, N.Y. (WWNY) - The state labor department has handed over more unemployment fraud cases to federal authorities in the past five months than it has in the past 10 years.

Department of Labor officials say they’ve stopped more than 42,000 fraudulent unemployment insurance claims since mid-March.

They say those claims could have amounted to more than $1 billion.

The coronavirus crisis forced many businesses to close and forced their employees out of work.

The federal government allocated an extra $600 a week to help people suddenly out of a job. States were responsible for doling out the money.

The state labor department came under fire as it struggled to respond to millions of new claims. Critics said it was taking too long for New Yorkers to receive their unemployment checks.

Labor officials say fraudsters use real New Yorkers’ identities to illegally collect benefits in the names of people who are not unemployed.

They say the individuals’ information may have been stolen in data breaches involving banks, insurance companies, major employers, and other institutions.