All states are currently experiencing an increase in unemployment claims fraud.  Massachusetts and Kansas recently provided updates on how these claims are affecting their state unemployment agencies.

Massachusetts:

Massachusett’s Governor Charlie Baker recently announced that a large percentage of initial unemployment claims had not passed screening for approval of benefits. He further explained that of 31,000 new claims, only about 1,000 cleared the state’s screening.

The state believes that most fraudulent claims are a result of “bot” or automated filed claims infiltrating the system. Unfortunately, the large volume of fraud claims are affecting the processing of legitimate claims and inundating both employers and their TPAs with this activity as well.

As CCC reported during the Fraud Education session held in June of 2020, Massachusetts has been fighting a large increase in fraud volume, along with several other states since the beginning of the COVID-19 pandemic.  In July the Massachusetts Department of Unemployment Assistance indicated that it had verified that more than 58,000 claims were filed fraudulently, but that the agency was able to recover $158 million.

Kansas:

Kansas recently communicated to all employers and their TPAs regarding the historic numbers of fraudulent unemployment claims they continue to receive. To date, the Kansas Department of Labor has prevented over 45,000 fraudulent claims from receiving payment.

Kansas DOL specifically has requested that fraudulent claims not be communicated through the SIDES system as it is not equipped to handle these types of claims. As a client of CCC, we take care of the state notification on your behalf. Please continue to inform your CCC  Claims Analyst of any claims that are fraudulent in nature.

In the United States, unemployment claims fraud can occur at any time. It is important to remain vigilant in auditing and reporting fraud. CCC has provided two guides to assist CCC clients with an overview of unemployment fraud, during the COVID-19 Pandemic and after, to assist in the prevention and management of unemployment fraud claims. You can find our COVID-19 Fraud Guide here and general UI Fraud Guide here. Please contact your CCC Account Executive for additional Fraud assistance.


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