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A senior federal law enforcement
source said the fraud is so
complex and multilayered that it
will take months to develop a full
accounting.
When investigators raided a
strip mall store, in December,
they found a line of customers
snaking around the parking lot
and huge stacks of cash inside
the store. Nguyen Social Services
was charging up to $700 a pop
to file false unemployment claims
for people who did not qualify to
receive Covid-19 relief money.
Government aid programs have
long been fertile ground for
scammers. A rush to release the
funds put enormous strain on
state workforce agencies, creating
a bonanza for individual scam
artists.
An early review in Nebraska, which
looked at all statewide payments
through June, found roughly 66
percent of unemployment money
was misspent.
The CARES Act was supposed to be
a lifeline for a U.S. economy in free
fall. One of the act’s mandates
Billions In Pandemic Aid
Was Swindled By Con Artists
was a new initiative called
the Pandemic Unemployment
Assistance program, aimed at
helping gig workers, caregivers and
people who are self-employed, all
of whom are not typically eligible
for unemployment insurance.
The program was quickly
flagged as high-risk by the Labor
Department’s inspector general.
There was no former employer to
verify this category of claims, so
states had to build the program
around self-reported work history.
“Water is going to find the leak.
The criminals are going to find the
weakest link,” said Alyssa Levitz,
who leads the unemployment team
at U.S. Digital Response.
The nationwide theft of taxpayer
dollars continued quietly until
December when Congress
mandated that states verify the
identity of claimants. ID.me,
an identity verification company
that has now been contracted by
21 states, told NBC News that it is
holding the line against a “veritable
tsunami” of fraudulent claims
flooding into state systems, raising
questions about what passed
through unseen before they got
there.
“It’s like looking at fire burning
inside of a house, but no fire alarm
is going off,” said Blake Hall, the
chief executive officer of ID.me. “It
really is a national crisis.”
Huy Duc Nguyen and Mai Dacsom
Nguyen, the pair accused of
forming Nguyen Social Services to
steal taxpayer funds, have each
been charged with multiple counts
including perjury and conspiracy to
defraud another of property.
Identity thieves, who use Social
Security numbers and other
personal information stolen in data
breaches and available on the dark
web, account for 20 percent of the
phony claims identified by ID.me,
according to a company report.
Many identity theft victims may
have no idea that benefits were
filed in their name. But in recent
weeks, millions of Americans began
receiving 1099 tax forms from the
IRS for benefits they never got.
Michael Webb, a 41-year-old former
business owner from Lexington,
Kentucky, was dumbfounded when
he received a 1099 that showed
$13,000 in benefits was filed in his
name.
Webb had filed for unemployment
benefits in March — and followed
up repeatedly since then — but
never got his claim approved. He
now suspects it may have been
because someone had already
made a claim using his personal
information.
By: Brittany Samuels SL News
Source NBC-Politico