What Kansas employers should know about rising fraudulent unemployment claims

Fraudulent unemployment claims have risen across the country  over the last year. Kansas has been hit particularly hard. In some of the opening weeks of 2021, the state received the third-highest number of initial claims for jobless benefits, behind only California and Illinois. Some believe the high number of claims indicates Kansas is experiencing a greater tide of fraudulent claims than other states.

What’s going on

The Kansas Department of Labor (KDOL) recently divulged the state’s unemployment insurance program paid what it believes to be around $140 million in fraudulent claim payments in 2020. The department and state lawmakers are analyzing multiple solutions to the issue, including an overhaul of the unemployment system and additional legal protections for employers.

Often, scammers are filing fraudulent claims using the names and personal information of people who haven’t lost their jobs. In many cases, scammers use personal information they obtain through buying stolen personally identifiable information or information released after a data breach. The fraudulent claims result in not only costs to the state but also problems for the employer and employees who were targeted in the scam.

What should employers do to mitigate fraud?

A well-trained and vigilant HR department can be your first line of defense against unemployment fraud. Fraudulent claims are often discovered when an employer receives a notice to verify the employment status of a current employee. Your HR department should scrutinize unemployment notices to identify such claims.