By Jason Shultz, CPA, & Benjamin Whitley, CPA, CMA
The nationwide shutdown in the wake of the COVID-19 pandemic led to a steep rise in unemployment claims as many Americans found themselves out of work. Scammers are taking advantage of the situation by filing false claims using the names and personal information of people who have not lost their jobs. It is important to remain vigilant to help protect yourself from becoming a victim of identity theft, and it is equally important to respond quickly when you do become a victim.
First things first, if you become a victim of unemployment fraud, make sure to report it to your state’s unemployment agency and your employer’s HR department so that your company can take necessary precautions.
- In Oklahoma, go to https://my.ok.gov/Forms/Report%20Unemployment%20Fraud and complete the form.
- In Arkansas, go to https://www.dws.arkansas.gov/unemployment/reporting-ui-fraud/, email email@example.com or call (501) 682-1058 and leave a message.
Whether you’re a victim of one of these scams or not, the steps below can help you protect yourself against identity theft during COVID-19 and beyond.
Access a Free Credit Report
Obtain a free credit report from the three major agencies (Equifax, Experian, and TransUnion) to review your credit and look for anything suspicious. Should you find errors, dispute them immediately. Historically, you could only do this once per year; however, with COVID-19 and the increase in fraud, the credit bureaus are allowing users to access a report once a week through April 2021.
Freeze Your Credit
A credit freeze will protect you from a fraudster trying to access your credit reports. This article provides additional information and the links to freeze it at each of the three major agencies. A freeze is available to anyone, regardless of whether they have been a victim of identity theft, or not. You may also want to freeze at specialty bureaus; find a complete list at the Consumer Financial Protection Bureau here.
Obtain Fraud Alert
Placing a fraud alert on your credit is a good idea if you don’t want to freeze your credit, but you do want to alert creditors to take additional steps to confirm your identity.
While a freeze generally stops all access to your credit report, a fraud alert permits creditors to retrieve your report as long as they take steps to verify your identity.
You only have to notify one agency that you want to place a fraud alert on your credit. That agency will contact the others and inform them of the requested alert. Alerts must be updated annually.
Report Fraud or Theft
Based on what you know was stolen or used fraudulently, report your identity theft to the relevant entities (financial institution, medical facility, insurance company). Also file a report with the Federal Trade Commission at their dedicated identity theft website, the Social Security Administration at 1-800-772-1213, and/ or your local police department. Save copies of all correspondence.
Secure Credit Monitoring
Credit monitoring is worthwhile if you have already been a victim of identity fraud, may not want to actively monitor your own reports, and/or you do not believe that a credit freeze or fraud alert is enough. Generally, credit monitoring does cost money, although the three major agencies are offering some level of monitoring for free right now and other free services are available.
Paid services may be available at no cost to you as a benefit with your employer, bank, credit card issuer, or insurance company. If you do pay, make sure they monitor the three major agencies. Some companies offer additional benefits like a Virtual Private Network solutions or family pricing.
Important: If you know you have been part of a breach, the company responsible for the breach is required to provide you monitoring for free (for 12 months).
Protect Your Physical Mail
Sign up for USPS Informed Delivery for each adult in your household. This service provides an email with a picture of all the mail coming to you each day, so you can confirm that nothing is stolen. It also prevents identity thieves from signing up as you for Informed Delivery.
Handle Tax Fraud
If a fraudulent return is filed in your name you will have to sign an affidavit, file a paper return with the IRS and provide the affidavit to your state tax agency. The IRS will also issue you an Identity Protection PIN to use for future returns. Coming later in 2020, taxpayers can obtain an IP PIN before identity theft happens, depending on the state they live in. Consider enlisting a tax pro to help.
Use a Password Manager
Password managers offer greater security for the use of passwords to access online services. Most businesses offer password managers for their employees. Check with your IT department to see if you are eligible for this useful tool.
Develop Unique Passwords
To increase your security, make sure you create unique passwords for all your accounts. Password managers auto generate unique passwords. If you do not use a password manager, take extra care when developing passwords.
Consider a Virtual Private Network (VPN)
Consider the need for a VPN in your home. This may be included in another service in which you are already paying (like credit monitoring).
Be sure to keep up with any security advice you hear coming from your company’s IT department. Remember, it’s always harder to clean up a mess than it is to prevent one.