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Unemployment scam is locking out those with legitimate claims to benefits

Brian Wilson has been unable to apply for benefits because someone apparently pilfered his personal information and used it to apply for benefits in his name.Pat Greenhouse/Globe Staff

After going a month without a paycheck, Diana Ragas wants the thousands of dollars in unemployment benefits she’s entitled to.

But she has been blocked from filing an application because, as has happened to an untold number of people, a Nigerian scam artist apparently filed under her name first. Unbeknownst to Ragas, the scammer had stolen her Social Security number and used it to file a fraudulent claim for unemployment benefits.

Something similar happened to Brian Wilson, 40, of Jamaica Plain, who filed for benefits last month after his contract as a college professor wasn’t renewed. Like Ragas, he was locked out of the computer system when he really needed it. He said a customer service representative at the state unemployment agency told him it was because of concern about possible fraud in certain accounts.


“I called every day, but got nowhere,” he said. “No updates, no call backs, nothing.”

For weeks, the state Department of Unemployment Assistance has been largely silent on the scam’s scope and impact, releasing virtually no information about how many people like Ragas and Wilson have been blocked from collecting needed benefits or about when the system would be fixed.

“It’s been extremely frustrating,” said Ragas, 56, a furloughed medical librarian at a New Bedford hospital.

Monica Halas, a Greater Boston Legal Services attorney who represents many clients in unemployment benefits disputes, said, “I’ve been seeing a lot of delays, and our clients don’t get information about why. People need to be informed why.”

During a virtual state Senate “listening session” on Friday, Rosalin Acosta, secretary of the Department of Labor and Workforce Development, touted some of the unemployment agency’s achievements, such as its daily virtual town halls (alternatively in English, Spanish, and Portuguese) and the 48,000 calls it now handles daily. But she said nothing about delays triggered by the fraud scam and wasn’t asked about it.


For weeks, the only thing the Baker administration has said about the scam came in a May 27 press release acknowledging that Massachusetts was among a dozen states whose unemployment agencies were targeted by a network of scammers, apparently based in Nigeria.

The press release provided no information on the scope of the problem, except to say “large amounts of illegitimate" claims had been filed. It provided a link to a web page for reporting fraud and warned that newly added identification requirements would cause temporary delays.

But it has said nothing about those with legitimate claims for benefits who have been blocked from filing because a criminal filed first, or those who say they have been abruptly cut off from benefits without explanation, apparently while the state verifies their identities.

Other states have provided far more details on the dimension of the scam, while imposing new restrictions they acknowledge have slowed payments. In Washington state, for example, officials have said they began reviewing 190,000 claims for suspicious activity last month, of which half have now been resolved, with the state clawing back more than $300 million in erroneous payments. Still, fraudsters may have gotten away with $350 million, they say.

Maine last week implemented a 48- to 72-hour delay on paying out benefits to give officials more time to scrutinize claims, according the state’s Department of Labor.

The Secret Service was the first to sound the alarm about a Nigerian group trying to exploit the pandemic by committing "large-scale fraud against state unemployment insurance programs.” It estimated “potential losses” in the range of "hundreds of millions of dollars.”


When the fallout from the pandemic sparked massive layoffs in Massachusetts, the crush of applications for unemployment nearly overwhelmed the state Department of Unemployment Assistance and its creaky computer system, similar to what state agencies across the country experienced.

In the early stages of the pandemic, many frustrated applicants were stymied by computer glitches, including rampant problems trying to input passwords, income amounts, even names. Some said it sometimes took weeks to get the agency to call back.

Since then, the DUA has regularly released figures that reflect how hard it has been working to address the problems, like the number of employees added each week to the customer service ranks and the number of return calls made daily to claimants. But it has declined to reveal the size of its call backlog or say how long it takes for a claimant to get a call back.

Now, since the fraud scheme was uncovered, the DUA has refused to say how many people may have been affected by fraudulent claims filed in their names, what steps it is taking to verify the identities of those who were already receiving payments, and how long those payments will be suspended while that work goes on. And it also refuses to say how long people like Ragas will be blocked from filing legitimate claims while phony ones filed in their names are investigated.


I sent the DUA a detailed description of the issues Ragas and others face as they remain locked out of the agency’s system. A DUA spokesperson provided a terse response, saying only that the agency was working with state and federal law enforcement agencies “on the investigatory and prevention responses necessary to combat this national unemployment fraud scheme.”

“DUA can assure that there is no evidence of a state data breach and protecting claimants’ information is our top priority,” it said.

I know the state’s unemployment agency has been deluged with more than 1 million new claims since March. But it has also grown its staff to about 2,000, from 50.

I think someone at the agency should find the time to rescue Ragas and others like her from unemployment limbo and give a better public accounting of what’s going on.

“There’s been no communication,” said Ragas. "It’s unacceptable.”

Ragas said the half dozen customer service reps she has spoken to at the unemployment agency seemed earnest and even empathetic. But they all told her she needed to work with the agency’s fraud unit to resolve the impasse.

“Call this number,” they said.

So she did. But nobody answered. Ever.

On the morning of June 5, a frustrated Ragas silently vowed to let the phone ring until someone picked up.

“I don’t care if I have to wait all day,” she thought.

She did, staying on the phone for 7 hours and 15 minutes. She would have waited longer but the fraud office closes at 4:30 p.m. and her call suddenly went dead.


Can you imagine hearing the same three-sentence voice message every minute or so, more than 400 times in all. “Thank you for holding. All representatives are still busy. Please continue to hold and your call will be answered in the order it was received.”

Ragas was quick to say how fortunate she feels to have savings and a husband who is working. She needs the money, but not to survive.

“What about the people with young kids who are struggling to keep food on the table and pay rent?” she asked. “I know I am not alone in this.”

Shane Martino, 47, of Northampton, also complained of an information blackout at the DUA, though in his case he has seen no evidence of identity theft.

Laid off from his warehouse job, Marino began receiving weekly unemployment insurance payments in late April. But after May 20, they abruptly stopped.

Martino said he never received notices of any kind from the unemployment agency and when he calls, he can’t get any answers. He said that at one point a customer service rep told him he needed to upload a photo of himself holding his driver’s license, but another rep later contradicted that.

“Whether the problem is due to a computer glitch or some other reason, it’s a big deal to me,” he said. “At this point, I’m down to my last $6.”

Got a problem? Send your consumer issue to sean.murphy@globe.com. Follow him on Twitter @spmurphyboston.