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Unemployment fraud problems continue for state, laid-off claimants in Pennsylvania

Web pages used to show information for collecting unemployment insurance in Virginia, right, and reporting fraud and identity theft in Pennsylvania, are displayed on the respective state web pages, Friday, Feb. 26, 2021, in Zelienople, Pa.
Web pages used to show information for collecting unemployment insurance in Virginia, right, and reporting fraud and identity theft in Pennsylvania, are displayed on the respective state web pages, Friday, Feb. 26, 2021, in Zelienople, Pa.

Pamela Jerry found out last year someone had tried to file for unemployment benefits using her name and other personal information.

Both she and her employer notified the state that the filing wasn’t legitimate — Jerry was employed, and the claim appeared to be one of thousands of fraudulent attempts to get benefits from the state that have been filed by thieves since the start of the pandemic.

She didn’t think too much more about it at the time.

Then, months later, Jerry, of Bucks County, actually was laid off from her retail job.

“Something in the back of my head, of course, said ‘Oh no,’ because I hoped the state had cleared all this stuff up,” she said.

It hadn’t.

Jerry has been trying unsuccessfully to file for unemployment benefits since October of last year, and has been depleting her savings. She’s hoping she’ll soon get what she’s owed after months of assistance from her state senator’s office.

Her situation encapsulates a problem Pennsylvania’s unemployment compensation system is still grappling with, close to two years after the tsunami of claims at the start of the pandemic — the state Department of Labor & Industry must figure out how to reject fraudulent claims, while still paying legitimate ones.

Legislators and advocates say the problem is massive, with serious consequences for people like Jerry and others who are owed money.

It’s unclear how many total fraudulent claims have been filed, but state officials have said the fraud problem is enormous, and ever-shifting. In the early months of the pandemic, fraudsters targeted Pandemic Unemployment Assistance – a new program created by the federal government to help people who wouldn’t have qualified for traditional unemployment benefits. In recent months, state officials say, fraud attempts have tended to target traditional Unemployment Compensation.

The Department of Labor & Industry estimates more than 440,000 UC claims have been flagged as potentially fraudulent between when its new computer system went online last summer and the end of 2021.

“Since the beginning of the COVID-19 crisis, foreign and domestic fraudsters have been exploiting unprecedented demand on the nation’s unemployment compensation systems that exist to protect hardworking Americans and their families during times of hardship,” L&I Secretary Jennifer Berrier said in a statement earlier this month. “Fraud-detection measures have revealed an increased level of sophistication in the most recent attacks on our system.”

Since the new computer system went online last June, the department says it has prevented more than $4.7 billion in state and federal dollars from being paid out to fraudsters.

State Rep. Nick Pisciottano, D-West Mifflin, and a member of the House Labor and Industry committee, said the state has a fine line to walk between preventing fraud and still allowing ordinary people to receive aid.

“The department has a very hard mandate, where they have to be accessible to every member of the economy. Every worker has to be able to come in and file a claim and receive their benefits timely. That makes it easier for fraudsters to come in and create fraud cases that take a longer time to resolve, potentially lead to criminal activity and things like that,” he said. “So, while a private business could just shut off access to a segment of the economy that's too difficult to prevent fraud in, government doesn't have the ability to do that. They have to be accessible to as many people as possible.”

His office still helps people with unemployment claims daily, he said.

A report last month from an advisory committee said the state should do a better job of publicizing that it accepts in-person identity verification in some instances for people who are struggling with its online verification systems.

Fraud issues in the unemployment system are “a massive problem” said state Sen. Lindsey Williams, D-West View, both for people who are victims of fraud, but also legitimate claimants who are being stymied by anti-fraud measures.

Steamfitter Michael Vento has struggled to get money he’s owed through Pennsylvania’s unemployment compensation system. Vento lives in Florida but worked in Pennsylvania for almost a year, at the Shell cracker plant site in Beaver County. His claim was denied by the state, and he received a letter saying the state had determined “the claim was identified to be filed as a result of fraud.”

Vento isn’t sure why the state thinks his claim is fraudulent, other than his Florida address. “This is ridiculous. Everything is 100% by the book on my end. I worked almost 52 weeks straight at the cracker plant. Do they understand the strain this puts on working families?” Vento said.

Barney Oursler, who heads the Mon Valley Unemployed Committee, said Vento isn’t the only out-of-state worker from the Beaver County site he has been assisting in fighting for the benefits they’re owed.

“These individuals had skills that brought them up to Pennsylvania for a substantial period of time…they’re being denied simply because of where they are applying from,” he said.

Oursler said he’s also helped others who worked elsewhere in Pennsylvania and lived nearby in Ohio and West Virginia whose unemployment claims have been denied.

“The state is assuming, being from out of state, you’re fraudulent. You cannot assume that,” he said.

To report fraud, call the PA Fraud Hotline at 1-800-692-7469.

If you believe your unemployment claim was incorrectly deemed fraudulent, you can contact the Department of Labor and Industry here.

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Kate Giammarise