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Tuesday, March 9, 2021

Workforce Development’s Failed Attempt to Combat UI Fraud

Yesterday we wrote about Indiana’s Department of Workforce Development being besieged by unemployment fraud and its inept response to the situation affecting countless out of work Hoosiers. As we promised yesterday we will be going into more detail as to what the state has attempted to do so far to fight back against the rising tide of unemployment insurance fraud and identity theft. 

Bob Segall in his report at WTHR states:

 13 Investigates also obtained the agency’s $500,000 contract with ID.me, signed in November to reduce the state’s high rate of unemployment fraud. In the contract, DWD admits “the fraud schemes have evolved in concert with our efforts to thwart them,” and the massive problem has led to an “extraordinary volume of claimants currently locked” out of their accounts.”

Click here to read the state’s contract with ID.me. Apparently the locking of unemployment insurance accounts by the state is part of their strategy to prevent further fraud. DWD began implementing steps to combat UI Fraud back in the summer of 2020. The company the state hired to help verify unemployment claimants identities ID.me is run by it’s CEO Blake Hall. Hall’s company has also been hired by Florida, Georgia, Nevada and Arizona to do assist with verifying claimants identities. ID.me’s identification process as reported by WTHR is

 The verification process requires unemployment applicants to show documentation – sometimes even engaging with online representatives by holding their driver’s license photo next to their face during a video chat – to prove their identity.

The ID.me executive said the verification process has caught scammers trying to hold up a photo of someone else in an effort to fraudulently pass an identification screening. It regularly detects con artists trying to submit an unemployment claim for a U.S. citizen while they are using a computer or cell phone thousands of miles away in foreign countries. And the verification process quickly flags accounts that change a cell phone number or bank account number immediately after passing verification.

“From what I’m seeing and from the audit we’re doing … it looks like the fraud rate is about 40 percent if not higher,” Hall said. “We’re blocking about a billion dollars in fraud per week. In California alone, we’ve blocked $9 billion in fraud.”

Now DWD’s locking of a suspicious account may help to stop or prevent fraud until the disputed unemployment claim is resolved. That would be okay except for the fact that according to WTHR it can take 12 to 16 weeks to investigate and resolve a disputed claim. Also if someone who is just the victim of unemployment fraud has there account locked it punishes them because they cannot file a claim for money they are entitled to. 

Segall points out that a “13News investigation revealed 1,256,463 of the unemployment claims filed by Hoosiers who were unemployed during the weeks ending March 7 through Oct. 3 were still classified as “pending” in late October. That same investigation showed hundreds of contracted workers hired by DWD to handle calls from people who filed for unemployment are not trained in how to resolve pending claims. The state says some of its backlogged claims are pending due to showing signs of fraud, but DWD did not elaborate on the actual number. 13 Investigates has requested more updated data from the state to show its current number of backlogged claims, but DWD has not yet provided that information.”

To add more insult to injury the state refuses to say what if any system they have in place to notify Hoosiers that there is suspected fraud on their unemployment insurance. As Bob Segall points out you can be a victim of unemployment fraud, even if you never file for unemployment.

Bob Segall reveals that his Social Security Number was stolen by scammers who used it to open unemployment accounts in various states. As Segall recounts:

 My first warning sign was a debit card I unexpectedly received in the mail. It is from US Bank, and when I called the bank, I learned it had been sent to me because I had applied for unemployment benefits in the state of Ohio. Of course, I had not.”

ODJFS (Ohio Department of Jobs and Family Services) confirmed someone had used my name, address, former phone number, date of birth and Social Security number to submit several PUA claims in October totaling $8,694. The state had already paid $1,746 of those benefits – not to the debit card I had received, but to a Wells Fargo bank account the scammer had set up in my name. The ODJFS staff member I spoke to said the state was getting ready to make another payment to that bank account when I called to inform the agency that I have never applied for unemployment benefits in Ohio.”

Segall than went to DWD’s website here in Indiana and as he feared someone had setup an Unemployment account in his name. Segall recounts: “ I looked at the DWD website and attempted to set up an account, figuring it might allow me to speak directly with a fraud investigator. But when I tried to set up a general account, the DWD website told me I had already created one and was now entering the incorrect password. My suspicion was correct. Someone opened a DWD account using my name, address, work address and Social Security number in mid-September. Whoever created the account had not yet filed any vouchers, but a DWD customer service representative told me it was likely just a matter of time.”

Segall was amazed that he could be a victim of this without ever filing a claim. Here is what Segall did next:

It took me about eleven hours to get ahold of all three state unemployment offices to report the fraudulent claims and accounts in my name; to contact the Equifax, Transunion and Experian credit bureaus to initiate a year-long credit freeze; to speak with law enforcement agencies in all three states and to file a police report in Indiana; to file a stolen identity report with the Federal Trade Commission; and to reach US Bank and Wells Fargo to deactivate the debit cards and fraudulent bank accounts opened in my name.

Fortunately Segall was able to take care of his issue while being unemployed. But most others are not so lucky. It is nothing less than a travesty of justice and fiscal irresponsibility that after all these years the state of Indiana continues to have such a colossal wreck of a state unemployment system. We all remember back in 2012 when Paul Ogden and the late, great Gary Welsh wrote about how whistleblowers at the state pointed out how mismanagement at DWD contributed to the insolvency of Indiana’s UI Trust Fund. As well as the awarding of a contract to DWD to a company that the then head of IT at DWD Roy Templeton had a financial stake in which Gary and Paul also reported on. 

What must be done is the management and DWD as well as Governor Eric Holcomb need to be forced by the citizens of the state to actually do their damn jobs! Also the United States Department of Labor needs to get off it’s ass and reign in DWD once and for all! Yes we have heard excuses that USDOL has bigger problems to deal with. That is complete and utter nonsense! As is the inaction of the US Attorneys Office in Indianapolis regarding corruption and white collar crime here in Indiana. Take for example their refusal to look into Governor Eric Holcomb’s shady deal to attempt to get an Amazon distribution center moved to Indiana which we wrote about previously on this blog.
Here is what we all suggest reach out to DWD and Governor Holcomb and let them know that this continuing waste and mismanagement of taxpayer money will not be tolerated! Here’s the email addresses and some phone numbers for you all to call and complain. Don’t just call and leave messages, or send emails. Call them every 15 minutes! Also call and email your state legislators and voice your displeasure. Here’s the contact information for you all!
Let the Games Begin!

Governor Eric Holcomb:

Office of the Governor is located at 200 W. Washington St., Rm. 206, Indianapolis, IN  46204

Phone Number: 317-232-4567

To send an email click on: http://www.in.gov/gov/2752.htm  then select " To contact the governor with questions or comments unrelated to the above, click here."

Reach Governor Holcomb on Twitter:


Reach Eric on Facebook: https://www.facebook.com/GovHolcomb/

Reach out and leave a message for Eric on YouTube:https://www.youtube.com/channel/UCmcggUX5rA1za_ya16joSKA

Or go to his Instagram Page:


To give DWD a piece of your minds:

Indiana DWD Benefit Call Center:
1-800-891-6499 (M-F 8:00 am to 4:30 pm EST)

DWD Mailing address:
Department of Workforce Development
10 North Senate Avenue
Indianapolis, IN 46204

DWD Fax:
(317) 633-7206

DWD emails & phone #’s where available:
Commissioner Fred Payne - Send DWD Commissioner Fred Payne your thoughts, complaints, gripes to this address:

Commissioner Fred Payne


Department of Workforce Development
10 North Senate Avenue
Indianapolis, IN 46204

Or by email: FPayne@dwd.IN.gov

Chief of Staff Josh Richardson - JRichardson@dwd.IN.gov 


Chief Communications Officer Bob Birge - RBirge@dwd.IN.gov


To find your state legislators go to this website:


Monday, March 8, 2021

Victims of Unemployment Fraud Forced to Fight Indiana’s Workforce Development System

As if here in honest to goodness Indiana the state isn’t being run badly enough, the Hoosier state’s ineptly run Department of Workforce Development (DWD) is doing it’s part to cause more unnecessary pain and anguish to Indiana taxpayers. Back on February 4th, 2021 Bob Segall over at WTHR reported on how the state is failing to provide adequate customer service to those who are the victims of unemployment insurance fraud.

Segall reports

For many Hoosiers who find themselves out of work because of COVID-19, getting laid off has not been the most frustrating aspect of the pandemic.

“As of September 1, we were all out of jobs,” said Erin Fisher-Leser, a compliance specialist who was laid off this fall by an Indianapolis travel management company. “There I was, filing for unemployment for the first time in a really, really long time, and when I tried to file online, I was locked out of the system.”

Yvonne Matlock tells the same story. The pandemic triggered job cuts at the healthcare facility where she worked as a fundraiser. And even though Yvonne received a severance package, former co-workers encouraged her to begin the process of establishing an account with the state unemployment office.

“My last day of employment was Nov. 6,” she told 13News. “Right away I got online to set up my account and it said I already had an account. I couldn’t even set anything up. I knew something was wrong.”

Erin and Yvonne quickly discovered why they could not set up accounts to file unemployment claims with the Indiana Department of Workforce Development: somebody had already beat them to it.

“Someone had opened an account on the 29th of June under my previous married name of over 30 years ago. They also set up bank account routing information,” Erin said.

“Someone filed a claim using my Social Security number in Philadelphia,” Yvonne explained. “I’ve never lived in Philadelphia in my life, so when I talked to someone at the unemployment office, I said ‘No, that’s not me.’”

Yvonne and Erin are victims of a widespread cyber fraud scheme that has diverted tens of billions of dollars in unemployment assistance away from the laid-off workers who need it most. It is happening all across the country. But here in Indiana, state officials are hesitant to discuss the scope of the problem, and 13 Investigates has discovered Indiana’s unemployment system often revictimizes the unemployed workers it is supposed to help.

Segall goes onto report that Yvonne and Erin have spent countless hours trying to email and call DWD and speak to the Fraud Investigators or someone to help get these issues resolved so they can collect unemployment. But as Yvonne said: “I feel like they don’t care, that they just really don’t care,” Yvonne told 13News. “When you call, you get a different person every time. It’s like you’re not even a number to them. You’re just a person on the other end of the phone,” she said, wiping tears from her eyes.

Unfortunately as Segall reports Yvonne and Erin are some of only many, many victims of unemployment insurance fraud:

“This is the largest cyber attack in terms of fraud in American history. Period,” said Blake Hall, a security expert who founded ID.me, a company that is now helping Indiana DWD and other state unemployment offices fend off massive amounts of fraud. “You have organized crime rings from Russia, from China, from Nigeria, from Ghana, as well as a lot of domestic identity thieves, and they’re all working together on the dark web. They’re sharing information about how each state works to defraud the state, and they just follow a playbook.”

Now of course Bob Segall and WTHR have tried to contact DWD directly and speak with them about the issues that the state is having with unemployment insurance fraud, but as has been the custom since the election of “Godfather” Governor Mitch Daniels, DWD refuses to be transparent with we the people:

13 Investigates contacted DWD in early December 2020 to ask how big this problem is across Indiana. Specifically, 13News asked how many fraudulent unemployment claims the department had received, how much of the $6.48 billion in 2020 unemployment payouts went to con artists trying to scam Indiana’s PUA (Pandemic Unemployment Assistance) program, and the steps DWD takes when it determines that an unemployment claim has been filed by an individual using another person’s Social Security number.

It appears Indiana’s Department of Workforce Development either doesn’t know the answers to those questions or will not publicly release the information. Two months after receiving WTHR’s request submitted under the Indiana Access to Public Records Act, DWD has not answered any of 13News’ questions and has repeatedly refused to meet with 13 Investigates to discuss the issue.

On Jan. 7, DWD spokesman Bob Birge told 13News “I hope to have some answers for you shortly,” and when asked again a week later, Birge wrote “Will check on your APRA request.” He has not responded since. The governor’s office also declined a request for an interview.

Segall also points out that “ state officials in Colorado, Ohio and Colorado are willing to openly discuss their unemployment fraud numbers, state leaders in Indiana have, so far, chosen not to release that type of information.”

It appears though that Segall and 13 News have gotten someone’s attention at DWD because DWD Commissioner Fredrick Payne decided to come down from his thrown and actually say something to Segall:

“We’ve become targets of fraudsters and scammers,” Payne said while discussing the state’s unemployment program during the governor’s weekly COVID-19 virtual press conference. “Seventy-one percent of current PUA claims have fraud indicators that require additional investigation.”

Since the DWD Commissioner refused to given any concrete information about the extend of the fraud issues with Indiana’s Unemployment System, Segall and WTHR obtained a list of identity theft complaints related to unemployment fraud from the Indiana Attorney General’s Office.

Segall goes onto say: 

According to the AG’s data, the first unemployment identity theft complaints in Indiana came in late April, just a few weeks after DWD implemented the federal PUA program. In June, the AG’s office received 14 complaints of identity theft linked to unemployment claims. By December, Hoosiers were filing more than 550 complaints per month – a nearly 4,000% increase.

So what is DWD doing to combat the increased unemployment fraud? Well for the answer to that you will have come back for tomorrow’s blog post where we will be discussing this issue more in depth. Till tomorrow this is the Indy Republican crew signing off.