Texas unemployment fraud soars to $2.5 billion during pandemic

AUSTIN, Texas (KTRK) -- The amount of Texas unemployment fraud during the COVID-19 pandemic continues to grow, which now totals more than $2.5 billion.

UNEMPLOYMENT FRAUD CONTINUES TO IMPACT MORE TEXANS

Chelsea Rash just started her first job in eight years, which is why she could not believe what arrived in the mail about a month ago.

"My heart sank into my stomach," Rash recalled. "I was like, 'I have no idea what's going on.'"

Rash received a letter from the Texas Workforce Commission dated from September. It states she received unemployment money, and she owes the state nearly $2,500.

"I've never in my life applied for unemployment," Rash said.

UNEMPLOYMENT FRAUD SOARS TO MORE THAN $2.5 BILLION

Unemployment fraud has skyrocketed during the pandemic. Over the past two years, the state has paid out nearly $60 billion in benefits, and about 5% of that was proven or suspected fraud totaling $2.53 billion.

"No amount of fraud should be acceptable," said Bryan Daniel, the chairman at Texas Workforce Commission. "Not $2.5 billion or $1."

The number keeps rising. In April, the government agency told ABC13 the amount of confirmed or suspected fraud was $700 million. It's now up to $2.5 billion.

The agency said new tools added this summer has allowed them to find new cases. Daniel said much of the fraud was done by thieves who used stolen information and there wasn't enough safeguards in place to catch the crime.

"When we were early pandemic, we were trying to make sure that Texans got their benefits," Daniel explained. "We gave people the benefit of the doubt. If you had the right social security number, the right address, the right name, we were likely to give you benefits because we knew people were hurting."

HOW TWC HAS MADE CHANGES TO REDUCE FRAUD

Over the past several months, TWC has made changes to its unemployment process.

"You will be asked questions today if you applied for that you might have been asked six months ago," Daniel said.

New applicants answer more questions than before to confirm their identity, whether it's a document or information the agency provided to the individual to confirm their identity.

TWC has seen improvement. In 2020, 95.8% of payments were made to correct claimants. In 2021, 95.2% of all claim dollars were paid to correct payments.

The number has risen recently. TWC said from mid-July to mid-August of this year, the rate of correct payment improved to 96.5%.

HOW TO SPOT IF YOU'RE AN UNEMPLOYMENT FRAUD VICTIM

TWC will only send a notice in the mail. If you receive a letter stating you're approved for benefits, or you owe an overpayment in benefits and you never filed, you might be a victim.

The letters give Texans a number and email to contact. Employers need to be on the lookout as well. If they receive notice an employee is getting benefits and they don't have a job, they should contact TWC too.

Rash said she did contact TWC more than a month ago. Now, she faces another problem. The letter said she needs to pay back the money by the end of October. She contacted TWC, but so far, no response.

"Frightening for one," Rash said. "I'm ashamed they can't even do that."

If you suspect you're an unemployment fraud victim, you can also report it to TWC through its website.

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