Why Washington state was a target for unemployment fraud

The big story in Washington state has been the delayed unemployment checks, which are being funded by the federal government, but have been slow to arrive because the state has been targeted by fraudsters.

Why is it that Washington State in particular seems to have been targeted?

“We were one of the first states to implement the provisions in the federal CARES Act that allows people who had previously been ineligible, such as those who are independent contractors and those who are self-employed workers, to be able to access the benefits, as well as access for all unemployment benefit recipients the additional $600 per week per person that continues to be available,” Washington Employment Securities Commissioner Suzi LeVine told Seattle’s Morning News.

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“That amount of money and the fact that Washington state was among one of the first to deploy it, I suspect is what makes us a very interesting target for criminals,” she added.

So there was no particular data breach that exclusively affected Washington state, and this was instead the fraudsters shopping around for the most generous state to defraud?

“I suspect so … most have had some sort of impact, whether it’s Massachusetts, whether it is Michigan, whether it is Rhode Island,” she said. “We have not had a data breach at the Employment Security Department. What the criminals are doing is using stolen information that they had previously taken from other breaches, like the Equifax breach or the other multitude of breaches that have happened over the past few years.”

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“And they basically are so sophisticated, they compile an understanding of individuals with their data, and then they are using that stolen data to then claim for benefits on our site,” LeVine explained.

But as Dave Ross noted, the money has to go somewhere. So when the agency sends out the money and, for example, it’s sent out of state, wouldn’t the computers detect that?

“I am not going to give a road map for what we are seeing at this point. I don’t want to help other criminals come in and try and execute what has been happening,” she said. “We’re working hard on cranking up our various parameters around catching the fraud before it happens.”

“This is a constant balance between reducing friction for individuals to receive benefits, versus increasing friction to keep criminals from perpetrating fraud.”

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