Texas Workforce Commission battles surge in unemployment claim fraud

AUSTIN, Texas - The surge in unemployment claims in Texas has also brought a surge in fraud.

The problem is so widespread two Texas senators and a senate staffer were all recently victims. Some people are learning about the fraudulent unemployment claimed in their name by getting a form from the IRS that incorrectly shows they received unemployment.

"Someone used my name, can't imagine them being brave enough to do that with all associated with trying to have my identity," said Sen. John Whitmire (D-Houston).

"Recognized I was a victim when I got a bill from Texas Workforce Commission that said I was overpaid in terms of compensation. Frankly I had not remembered firing myself," said Sen. Royce West (D-Dallas).

The executive director of Texas Workforce Commission said a half billion dollars had gone out to suspicious claimants, but TWC stopped another $3 billion getting into the wrong hands.

Ed Serna told lawmakers that some of the fraud is from overseas and some is domestic.

"When we ID a particular computer address or domain is suspected, we simply block that," Serna said.

Anomalies in banking patterns are also a red flag.

Sen. Lois Kolkhorst believes the problem may be even bigger than what the state has identified.

"I think it's the tip of the iceberg," she said. "I even have a staffer, someone claimed under his name. I don't understand how a teacher in Oklahoma can get a Texas claim, but those are the things that are happening."

The IRS says the fraud is happening across the country and many are only discovering they are victims when they receive a 1099-G form. The form shows unemployment received from Texas Workforce Commission.

"If you get a 1099-G in the mail, you don't want to ignore it," said Clay Sanford, IRS.

Sanford says if you receive a form for unemployment money you never asked for, you need to contact TWC right away and ask for a corrected form.

"You definitely don't want to add insult to injury and get a tax bill in the mail, for something that you didn't get," Sanford said.

West is thankful he found out about the fraud before any more damage was done.

"Ultimately will be day of reconciliation, those people will pay," West said.

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