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FBI Warns of Increase in Fake, COVID-Related Unemployment Claims

by Chris Brook on Tuesday July 7, 2020

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The Federal Bureau of Investigation said this week that its seen a spike in fraudulent unemployment insurance claims related to the pandemic.

Experts warned in March, at the onset of the COVID-19 pandemic, that identity theft would be a symptom of having an increasing number of people working from home.

Those warnings, according to recent reports, have translated to an uptick in scams looking to steal stolen identities to file phony unemployment claims.

The FBI warned on Monday that it has seen a spike in fake unemployment claims it believes is tied to personally identifiable information harvested during the ongoing pandemic.

The warning via the FBI comes a few weeks after the Federal Trade Commission said that its received over 105,000 complaints around COVID-19 fraud, with about half tied to lost money. At the time, that symbolized $68 million in money lost to scams; the latest figures – which include numbers to July 6, suggest the country's total fraud loss is closer to $78 million.

The FBI didn't elaborate exactly how attackers are accessing the stolen PII - it suggests it could be through the usual methods, either buying it online, taking advantage of prior data breaches, intrusions, email phishing, or cold calling victims using an impersonation scheme.

From there, the attackers are taking the data and using it to file unemployment claims. The FBI points out that most victims don't realize their information has been compromised until they go to file a claim for unemployment insurance benefits, receive an IRS form 1099-G - which recaps benefits collected from unemployment insurance - or receive a notification, either from their current employer or the state unemployment insurance agency that something is a afoot.

In addition to the usual vigilance that individuals should exercise - monitoring your bank accounts, using caution when opening up attachments, and being wary of anyone trying to get you to offer up your personal information – the FBI is encouraging individuals to be on the lookout for the following suspicious activities:

  • Receiving communications regarding unemployment insurance forms when you have not applied for unemployment benefits
  • Unauthorized transactions on your bank or credit card statements related to unemployment benefits
  • Any fees involved in filing or qualifying for unemployment insurance
  • Unsolicited inquires related to unemployment benefits
  • Fictitious websites and social media pages mimicking those of government agencies

The fact that authorities are seeing spikes in data theft associated with the pandemic should come as little surprise.

The Secret Service warned in May that an overseas fraud ring may have been behind one campaign in which identities are stolen and used to dupe the U.S. unemployment system. A report in the New York Times detailed the scam, which revolves around stolen social security numbers, and said it could result in "potential losses in the hundreds of millions of dollars." A memo obtained by the paper of record cited attacks observed in Washington State, Florida, Massachusetts, North Carolina, Oklahoma, Rhode Island and Wyoming.

Of course, hackers are also looking to profit off stolen medical data from biotechnology firms working on potential COVID-19 treatments. Bill Evanina, the director of the National Counterintelligence and Security Center, called on research facilities, hospitals, and pharmaceutical companies that same month to fortify their systems in order to safeguard their research against China and other nation states that could be looking to steal biotech data.

As we’ve seen, the uncertainty introduced by the pandemic has also translated to data loss internally at companies as well. With employees working from home more than ever before, workers are also moving data – most of it considered classified – onto USB storage devices, cloud storage services, and as attachments in email, too.

Tags:  Government Data Theft

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