Unemployment fraud constitutes collecting unemployment benefits under false information or in an otherwise unlawful matter. This is a serious infraction that diverts much-needed financial benefits away from the unemployed Kentucky residents who truly need them.
What Is Unemployment Fraud?
Several different behaviors can constitute unemployment fraud, such as identity theft – which occurs when someone knowingly uses another person’s personal information, including Social Security number, employment information, etc., in order to apply and qualify for unemployment benefits. Returning to work while continuing to collect unemployment benefits or lying about why you lost your job also constitutes unemployment fraud.
Other fraudulent behaviors include:
- Not reporting in a weekly claim any wages earned during that period, including from temporary or part-time work
- Withholding or knowingly providing false information to the Kentucky unemployment office
- Helping someone else access unemployment benefits they do not qualify for
- Reporting inaccurate hours and earnings
- Collecting benefits based on false information
- Collecting benefits even though you are unable or unavailable to work
- Claiming Kentucky unemployment benefits without actively looking for work
Both employees and employers can commit unemployment fraud. Employers can commit fraud in several ways. For example:
- Paying employees secretly or not accurately reporting their wages
- Failing to report new employees or inaccurately reporting start dates
- Misclassifying workers as independent contractors in order to avoid paying unemployment taxes on their behalf
- Providing false information to prevent a worker from being found eligible for benefits
- Failing to pay unemployment insurance taxes
- Failing to file appropriate reports
The state of Kentucky and the U.S. Department of Labor also are aware that some Kentucky residents may have received fraudulent emails requesting payments to help with unemployment benefits claims. Please know that the Kentucky unemployment office will never ask you to pay any amount of money to help you with your benefits claim. Any such request you may receive is a scam. You do not need to pay anyone to file or qualify for your benefits – do not share money or your personal information, including your credit card information, in response to any request of this type.
Consequences of Unemployment Fraud
In Kentucky, unemployment fraud can be classified either as a misdemeanor or as a felony, depending on its severity. According to federal law, states must collect a minimum 15 percent penalty on the amount of any fraudulent claim. And in most cases, someone found guilty of unemployment fraud will not be able to collect unemployment benefits in the future, at least for a specified time period. Additional penalties in Kentucky may include up to five years in prison, paying back the full amount of the fraudulent claim, plus the 15 percent penalty, and state tax return garnishment.
How To Report Fraud in Kentucky
If you know of a situation in which someone is fraudulently collecting unemployment benefits, you should report the fraud immediately. In Kentucky, you may use the state’s fraud reporting form to make an anonymous report. You also may use this form to report someone using your identity to apply for Kentucky unemployment.
If your identity is stolen, you also should reach out to your local police and file a report – and you may consider filing a report with the Federal Trade Commission. In addition, the U.S. Department of Labor’s Employment and Training Administration has launched a website to help people report unemployment identity theft when their identities have been stolen and used to fraudulently file for unemployment compensation.?
In cases of identity theft, you also should notify your employer and the IRS, and you should file a complaint with the National Center for Disaster Fraud. On a personal level, you may consider changing passwords to any online financial resources you use, contacting your credit card companies to ask for a fraud alert to be placed on your account, and requesting a copy of your credit report from the three major credit reporting agencies: Experian, Equifax, and TransUnion.
What Is Identity Theft?
Identity theft is a specific type of unemployment fraud – it happens when criminals collect others’ personal information and use it to file fraudulent claims for unemployment compensation. This type of unemployment fraud has been on the rise in recent years in Kentucky and was especially prevalent during the early days of the COVID-19 pandemic.
The Office of the Inspector General at the U.S. Department of Labor recently issued a warning about a particular unemployment benefits scam – many people have reported receiving emails from someone asking for money in exchange for helping with their unemployment benefits claim. This scam allows criminals not only to rob individuals of money, but also to take their personal information, including Social Security and credit card numbers, which can be used to file for further unemployment assistance.
How To Prevent Kentucky Unemployment Fraud
As a claimant for unemployment insurance benefits, there are several key steps you can take to protect both yourself and others from unemployment fraud in Kentucky. First, make sure you’re accurately reporting all information related to your claim – including your reason for unemployment, any wages you’re earning, and when you’re not able or available to work. You also should review your information carefully to avoid any inadvertent errors, and make sure to stop claiming unemployment benefits as soon as you begin working again. The Kentucky unemployment calculator can help you make sure your benefit amount is what it should be.
In addition, stay alert for scams and don’t fall prey to anyone’s request for payment to help with anything associated with your unemployment claim. The state of Kentucky will never ask for money in exchange for providing assistance or answering questions. In fact, anytime you have a question, Kentucky UI customer service representatives are eager to help you. You may call the UI assistance line at 502-564-2900. Someone will be able to help you Monday through Friday, with the exception of some national holidays.
Everything you do to prevent fraud not only protects you, but also protects the integrity of Kentucky’s overall unemployment system and helps ensure that unemployment benefits go to the people who need them the most.