How Washington state’s response to unemployment fraud is victimizing workers with delays, threats, & intense financial strain
Over the last three months, Washington has faced an unprecedented unemployment crisis due to the outbreak of COVID-19. Between strain on the system and unnecessary bureaucratic barriers, many unemployed workers have been forced to wait weeks, or even months, for payments to come through. As of May 1, the Employment Security Department (ESD)’s own figures showed that nearly a quarter of a million workers in Washington who had filed for unemployment benefits had yet to receive payments.
And compounding the crisis, our state is facing a new issue — unprecedented levels of “imposter fraud,” in which scammers file false claims, often on behalf of workers who are still employed, in order to access benefits earmarked for unemployed workers.
But while ESD has struggled to keep money out of the hands of fraudsters, this briefing details how their response to the issue is creating thousands of new victims — the unemployed workers with legitimate claims who are left waiting week after week without income as misguided new fraud-prevention measures exacerbate existing flaws in the application process.
ESD has been struggling to pay legitimate claims on a timely basis — or at all — throughout this crisis. Even before this wave of apparently fraudulent claims, tens of thousands of unemployed workers were stuck in limbo for weeks or months. Some were unfairly denied despite being eligible; others were approved but inexplicably missing weekly payments; and tens of thousands were stuck in “adjudication,” waiting for a message from ESD about their eligibility. It’s often unclear to workers why their claims have been held up. But in many cases, months-long adjudication processes are triggered by relatively minor issues like inaccurate reports from employers or inconsistencies in ESD’s user interface.
ESD committed to working through the adjudication backlog they faced in May by mid-June — three full months since the crisis hit. Now, ESD’s handling of the fraud wave is throwing thousands of workers back into the adjudication process, or inexplicably halting their payments, with no promise of when — or if — they will be paid.
“I received benefits for four weeks, then suddenly got a message saying they needed more info. My account said I needed to provide copies of my driver’s license and Social Security Card, and mentioned that I had possibly been overpaid. I provided the documents they needed, but now my status is ‘pending’ again and I haven’t received benefits for this week, which is frustrating because I have children and bills to take care of. Why give me benefits for four weeks and then suddenly stop?”
- Natasha, former accounting clerk, Federal Way
Since ESD rolled out its new fraud-prevention measures, many legitimate applicants who were already approved and receiving benefits are suddenly seeing their payments cut off through no fault of their own. Some of those workers had already waited weeks in adjudication, only to finally get approved, receive a payment or two, and then suddenly get cut off. And others still haven’t received anything at all — they have been waiting months to hear from ESD, and they are now faced with another flag on their account that could take additional weeks to process.
“I’ve been waiting nine weeks, countless hours on the phone only to be disconnected. I’ve been kind and patient as I understand what it’s like for the agents. Now all I’ve been told is that they will contact me to let me know they’ve received my identity information. Who knows how long that will be? I will get nothing until then. Who is going to pay my bills? I could try local churches, but I can’t afford the gas in my car to go get help even if they had it.”
- Teresa, former retail worker, Kennewick
ESD should certainly confirm identities as part of the process of filing a claim, but preventing fraud should not entail cutting off payments without explanation, threatening workers who have filed legitimate claims, or adding further strain to the adjudication queue. ESD must ensure their policies, including new fraud-response measures, center workers and prioritize quickly paying benefits to those who are eligible. If they fail to prioritize workers, thousands more will be left without income for months, unable to afford the basics their families need, or forced to return to work despite unsafe conditions or high risk for contracting COVID.
“More than two months after filing, I still haven’t received benefits, and I’ve become homeless. I’m working for DoorDash even though I’m diabetic and shouldn’t really be out working right now, because I have to pay for my car payment and insulin and food. Now, ESD is saying they’ve probably paid out hundreds of millions of dollars in fraudulent claims. And our claims are getting held up even further. I got a request to submit verification of my identity. I did it right away, within half an hour of getting the message. But now I have a new adjudication on my account, and nothing is happening. The real victims in this situation are the tens of thousands of unemployed workers who are not getting the benefits we need.”
- Steve, former bartender, Vancouver, WA
Here’s what thousands of unemployed workers have experienced over the last week.
1) An ambiguous “identity verification” system creating additional delays in paying benefits.
“I submitted my identity verification on Sunday when I was asked, but now my claim has gone back to adjudication and they literally just told me to wait it out. So my child has to go without her needs. I already dealt with a fraud flag way back when I filed my claim initially, and I gave them my driver’s license and everything. Now I have to go through all this again.”
- Nikita, former billing specialist, Spokane
As part of their anti-fraud push, ESD is sending messages to some workers requesting that they verify their identity by uploading a copy of their Social Security Card and driver’s license or other ID card. Many of these workers filed their claims months ago and have already gone through an extensive approval process, and ESD has not explained why some workers are receiving this message. It’s also unclear why ESD has waited until now, months into the crisis, to begin requiring this documentation if it’s needed to process payments.
Because they have not been transparent with workers, ESD’s requests for identity verification are confusing, concerning, and potentially risk more workers exposing themselves to fraud. ESD’s suggestion to send sensitive documents via email directly contradicts their own webpage on fraud, which directs workers to “never put their full SSN in an email.”
Additionally, many workers don’t have a copy of their Social Security Card or a driver’s license and may struggle to get copies in the several-day turnaround time ESD requires. Those who found it challenging to get the computer or web access they needed to file in the first place will find it doubly challenging to upload this documentation. It’s likely that some of the most marginalized workers, and those most in need of income support, will face the greatest challenges in providing this documentation to ESD, resulting in a cutoff from payments & potentially being denied benefits altogether.
But even for those who have been able to quickly upload the verification ESD asks for, this request results in a new flag on their account that prevents them from getting paid.
The vast majority of workers who have uploaded identity documentation have heard nothing back from ESD after waiting for over a week.
Because ESD’s system was closed to all incoming calls about individual adjudications up until May 20, workers facing this new issue, and unsure about how to respond, had no way to contact ESD about it — and although phone lines are now open again, workers are facing the same long hold times, dropped calls, and insufficient support they were facing before.
With no guidance about how long it will take their identity documentation to be processed, many of those who were already receiving benefits have already missed two weekly payments, and they are concerned they’re in for yet another weeks- or months-long process of waiting and attempting to contact ESD to get their benefits paid. And those who were in adjudication already are worried they may have to get through this new verification process before ESD will address the issues that had already held them up for weeks.
2) Notices of “possible overpayment” that put the burden of proof on the innocent.
“I got really upset because I know I haven't been overpaid and I've been honest and have provided all documents proving so. I even included more documents for them to see that I have not been overpaid. It’s causing anxiety for people. I get needing to verify people’s identities, but accusing you of overpayment when it's not actually true and they know that is ridiculous. They’re putting people through unnecessary stress because they messed up and allowed fraudulent claims to be processed. I have promised payment on three bills, and if my payments don’t come through, my phone will get cut off. Then I won’t have access to an internet or phone to contact unemployment, or even a way to hear from my boss about when we’re returning to work.”
- Renee, furloughed retail associate, Federal Way
Many workers — including but not limited to those who were contacted about providing verification of their identity — have received a confusing message from ESD telling them they may have been overpaid, and ESD “must decide whether [they] were actually eligible to receive those benefits.”
They’re told: “If it was your fault, you must pay it back.” And then they’re asked to answer the riddle: “Why do you feel you were not at fault for this overpayment?”
This message has been baffling to workers who have filed legitimate claims and have been receiving benefits. This communication leaves them at a loss: how they can explain why they “aren’t at fault for overpayment” when they have not been overpaid? ESD gives workers no indication of why they believe there’s been an overpayment. In fact, many of the workers receiving this notice have been underpaid, because issues in ESD’s system have prevented them from getting some of the benefits they’re owed.
A message like this is terrifying — especially for workers who went through a long process just to start getting their benefits paid out to begin with, and know how difficult it is to communicate with ESD when there’s an issue with their account. The notice seems to be a linguistic trap rather than a question, and one with potentially severe consequences if workers can’t puzzle out the “correct” answer.
Workers not only fear that they will lose their benefits — they also face the direct threat of garnishing future wages or bank accounts when many are already deep in financial crisis.
ESD’s communications routinely place workers in the position of having to defend themselves against a system that seems to implicitly accuse them of dishonesty, and explicitly prevent them from getting payments they are owed. Attempting to address fraudulent claims by issuing a sweeping notice to thousands of workers that they must defend themselves against “overpayment” is a clear example of the way ESD’s process and communications fail to prioritize workers and fail to treat them with basic respect.
3) Claimants suddenly lose their benefits with no notice, no explanation, and no recourse.
“I applied on March 22 and spent weeks trying to contact them about my initial claim — I scheduled four callbacks and never received one. I’ve literally tried everything and couldn’t get through to a live person. I was finally deemed eligible for benefits, but for the two months I have been out of work, I only received two weeks of payments. Now they are saying I was overpaid and owe them money back. It amazes me that people with legitimate claims can’t get money we are owed, yet people filing illegitimate claims are apparently getting paid. I am negative hundreds of dollars in the bank, and I have two children to support. My auto loan was deferred until June, but my payment is due soon, and I can’t make it. Are we supposed to just have our cars repossessed? What do they expect us to do?”
- Lorra, former auto sales receptionist, Auburn
Whether they’ve received an overpayment notification, an identity verification request, or both, the majority of workers whose accounts have been flagged due to new fraud-verification measures in the last week are in the same boat: suddenly losing their benefits with no notice, no explanation, and no recourse.
Workers who were regularly receiving payments are suddenly seeing their current weekly payment switch from “processing” (paying out) to “pending” (held up) once they respond to ESD’s requests for information. Or they’re seeing a new “pending issue” or adjudication on their account — meaning they’re now back in the queue of claims requiring individual attention from an ESD agent when virtually no individual attention is available.
And when that happens, workers who were seeing weekly payments are suddenly seeing those payments disappear.
“I am absolutely beside myself. I was counting on this week’s payment. My car’s water pump just went out. I pray we don’t have to wait another 6 to 8 weeks.”
- Brittny, former extraction specialist, Vancouver
ESD attempts to assure many workers with messaging that “if we have paid you in the last four weeks, we typically will continue to pay you ‘conditionally’ until we make a decision.” But workers who are stuck in these new verification processes are seeing payments immediately halted. And those who were already struggling to get approved have received no indication of whether this new process will delay their claim further.
Fraud is an important priority to address — but it’s important primarily because the theft of unemployment funds could impact unemployed workers who need benefits now. A fraud response that prevents workers from accessing benefits, and causes additional anxiety for those who are already facing financial crisis, is dangerous. It means more workers returning to work when it’s not safe for them, putting themselves and the public at increased risk; more delayed unemployment claims adding additional burden to an already-strained system; and thousands more workers with no income and no path forward.
Instead of allowing fraud to harm workers who need income support, ESD must prioritize clear communication and paying benefits to those who need them.
They must explain to workers why they are being asked to verify information, what this new process entails, and what timeline they can expect for resolution. They must communicate clearly and transparently with workers about their cases, rather than issuing anxiety-inducing threats about overpayment. And they must continue conditionally paying individual claimants undergoing these new verification processes, unless they are able to provide a reason to believe a given claim is fraudulent.
A “solution” to fraudulent claims that prevents even more workers from accessing benefits is not a solution at all.
ESD’s system fails to fulfill the promises our state has made to protect unemployed workers during this emergency — and their response to this issue makes unemployed workers the real victims of the imposter fraud crisis.