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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:


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