Treated Like Criminals

Unemployment insurance form on a table.

The Washington State Employment Security Department (ESD) is responsible for employment services, unemployment insurance benefits, analyzing labor market information, administering Paid Family and Medical Leave and it also helps investigate fraud related to unemployment benefits.

Sometimes investigations can be cumbersome for the victims of unemployment fraud. Seattle resident Deborah Rosenfelt received notice that her husband was being considered for unemployment benefits despite being employed. This raised suspicions that someone was fraudulently using her husband’s identity, so she contacted ESD. (The only day of work her husband missed was to handle the unravelling unemployment fraud situation.)

The bank the Rosenfelts had trusted for 25 years to keep their money safe froze their accounts after they reported the impostor fraud. The family did not have access to any of their own money. (Imagine being treated like a criminal for doing the right thing.) Chase refused to release their funds even after the family provided documentation from ESD confirming that they were not at fault for the fraud. (This is one instance when asking to speak to the manager won’t make you a ‘Karen’.)

Chase closed all checking and savings accounts associated with the Rosenfelts, including their teenage son’s account. (I bet Mama bear came out when that happened.) Chase claimed they were following instructions from the State of Washington by freezing the Rosenfelt family accounts.

The Rosenfelts were later told by Chase that they would be mailed a check with the money from their accounts but were not told how long that would take. Eventually, they regained access to their money and were able to transfer it to another bank. (They were denied access to money they depended on for groceries, bills, and basic survival for a prolonged period.)

ESD Commissioner Suzie Levine defended the actions taken stating that banking partners are notified so they can prevent fraudulent funds from being used. (Levine did not comment on what happens when fraud victims get caught in the bureaucratic crosshairs.) The ESD said it will continue to work with customers to help clear up situations like this one. (I’m not sure you can say they were much assistance in this case.)

Today’s Fraud of the Day comes from an article, “What to do if your bank freezes your account because of unemployment impostor fraud,” posted on on July 1, 2020.

The unemployment impostor fraud investigation at the state Employment Security Department is producing new problems for innocent people whose information was stolen by crooks.

Their banks are freezing their personal accounts.

Deborah Rosenfelt said it was bad enough to discover that criminals had been cashing in on four weeks of unemployment benefits using her husband’s identity. But the punch in the gut came from the bank where they’ve held accounts for 25 years.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.