(The Center Square) – Maine's pandemic-ravaged unemployment system is under siege by fraudsters and international criminal gangs who continue to file bogus claims.
For the week that ended Feb. 13, the state Department of Labor said it rejected at least 2,500 new claims for unemployment benefits that were determined to be fraudulent.
That's nearly as many as the 2,700 new claims for state unemployment benefits and federal Pandemic Unemployment Assistance approved by the state agency in the previous week.
To date, the state has rejected more than 48,500 initial claims suspected of being fraudulent and prevented at least $484 million in unemployment benefits from being paid out.
Labor Commissioner Laura Fortman said the state has "doubled" the size of its fraud prevention unit and poured more resources into weeding out fraudulent claims.
"This is a dynamic situation, and we continue to analyze and update our strategies as fraudsters evolve their methods," she said.
Maine and many other states have been targeted by criminals that are trying to file large numbers of illegitimate jobless claims using stolen financial information from data breaches.
Meanwhile, state officials are warning of "phishing" scams where unemployment recipients get text messages directing them to enter their login and password on a website that looks similar to the state labor department's claims portal.
Overall, Maine has distributed about $1.89 billion in federal and state unemployment benefits to more than 235,200 workers since March 2020, the agency said.
The fraud has most rampant in the federally backed PUA and Pandemic Emergency Unemployment Compensation programs, which were created to cover jobless workers, such as the self-employed and "gig economy" workers, who normally don’t qualify for traditional state benefits.
Last week, the state received a $1.2 million grant from the U.S. Department of Labor to address unemployment insurance fraud through identity verification and other security measures.
The funding is part of a new $49 million federal grant program aimed at helping states clawback some of the lost revenue for bogus claims.
“We are partnering with states as they innovate and apply new solutions to combat criminal attacks on their unemployment insurance programs,” Suzi LeVine, DOL's principal deputy assistant secretary of Labor for employment and training, said in a statement. “Criminals adapt their fraud techniques routinely, so we must be vigilant and determined to prevent those eager to deprive unemployed Americans of money they desperately need in these difficult times.”