Labor Dept.: Scammers manipulating legislators, social media, reporters in fraud effort

Click here for updates on this story

    DENVER (KCNC) — In acknowledging nearly $20 million in confirmed fraudulent unemployment claims during the pandemic, the Colorado Department of Labor and Employment also portrayed cunning and sophisticated scam rings that are trying to manipulate Facebook groups, state lawmakers and media organizations in an effort to pressure the unemployment department to loosen fraud controls, thus allowing scammers to steal more money from the state.

“The fraudsters are persistent and very smart,” said Phil Spesshardt, who oversees Colorado’s unemployment insurance program.

Spesshardt said in an effort to pressure CDLE officials to loosen fraud prevention measures, scammers have been infiltrating Facebook groups agitating and complaining, along with complaining to state legislators and news reporters about fraudulent claims. Spesshardt said the scammers’ aim is to bring pressure on the CDLE to ease up on fraud controls, thus making it easier to scam the system.

Much of the Friday news conference was spent updating how much had been stolen from the Colorado unemployment system during the pandemic. Last month, officials pegged the figure at $6.5 million. Earlier this week, in an interview with CBS4, they said that figure was more likely in the $20 million to $30 million range. On Friday, they said the confirmed figure of what has been lost to scammers to date is $19.37 million. There have been 42,976 confirmed fraudulent claims said officials who said prevention measures they put in place stopped payments of $437 million dollars that would have been fraudulent.

“There is no perfect answer,” said the CDLE’s Cher Haavind, who acknowledged numerous fraud holds have slowed the payment of legitimate benefits to claimants. “We know they are in desperate need of these benefits.”

But CDLE officials indicated they were trying to balance getting payments to claimants while making sure they weren’t paying fraudulent claims.

“There’s still a high amount of fraudulent activity a year later,” said Joe Barela, CDLE executive director.

Department officials said they expect the number of fraud cases and dollars lost will likely rise, but they noted other states that had acted more slowly than Colorado have lost hundreds of millions of dollars to fraudulent unemployment claims.

Please note: This content carries a strict local market embargo. If you share the same market as the contributor of this article, you may not use it on any platform.