Do the best you can to avoid being scammed by keeping yourself educated and being cautious, especially when the offer you’re receiving is too good to be true.
Phone scams continue to steal people’s money and identity while giving false hope that help is on the way. Cybercriminals will use any tactic and say virtually anything to get what they want. Scammers use many different cons, including sweepstakes and prizes, free vacations, home estimates, and more. People pose as members of political and charitable organizations or government agencies like Social Security, Medicare, IRS, FBI, and Small Business Administration.
The latest trend revolves around unemployment and pandemic relief benefits. Find out all you need to know to protect yourself from these phone scams.
What is an Unemployment Scam?
An unemployment scam comes in several variations. The common goal of each variation is to steal and use a victim’s information to steal money to line the scammer’s pockets. Sadly, these scams play upon the emotions and desperation of people who have lost their jobs, either temporarily or permanently, due to the COVID-19 (Coronavirus) pandemic.
While there has been some government relief in the form of Pandemic Emergency Unemployment Compensation (PEUC) and Pandemic Unemployment Assistance (PUA) programs, many families who have lost their income in the United States are struggling to pay their rent or mortgages and keep food on the table. The fear of being unable to provide for oneself or one’s family is a trigger that fraudsters will use without a second thought.
Since the beginning of the pandemic in the spring of 2020 millions of Americans have requested unemployment every week.
How Do Unemployment Scams Work?
Most phone scams operate the same way. A scammer places a call to an unsuspecting victim. The calls are usually made by robocallers, which can make hundreds of calls per minute. When a target responds to the robocall, the scammer takes over and begins their spiel. The con artist works off of a script, often talking very fast and asking questions without letting the other person answer. In this case, the caller often says they work for a government agency that can offer help to those recently unemployed. The help may come in the form of a stimulus check, unemployment insurance benefits, self-employed pandemic assistance, or another government program that can offer financial relief. Other related offers may include low interest mortgages, home equity lines of credit, and debit or credit cards. The scammer will attempt to get as much personal information as possible before leaving the victim out to dry.
The Federal Trade Commission has received numerous complaints about fraudulent calls, text messages and emails from people pretending to be from the IRS, Department of Labor, Social Security Administration, Census Bureau, Federal Deposit Insurance Corporation (FDIC), and U.S. Citizenship and Immigration Services (USCIS).
The phone calls and messages inform the targets that they are eligible for financial assistance. The caller may say there is an application fee to receive the money or that the person must supply bank account information so that the funds can be directly deposited. Those are two big red flags since there will never be a fee to apply for financial assistance from the government.
Additionally, government agency representatives do not call people to offer any kind of services. And lastly, no government agency will ever ask for bank information over the phone. Therefore, never give out personal information such as your address, birthdate, Social Security number or bank information. Also refuse to verify information any unsolicited caller claims to have.
10 Most Common Unemployment Scams
The following are the 10 most common phone scams and how they can be avoided. Keep in mind that the scammers claiming to help you apply for unemployment insurance benefits or update unemployment claims will try to get your personal and financial information. They will use phishing techniques to install malware or viruses on your smartphone or computer.
The biggest red flag for a phone scam is when the caller asks for money and requires the transfer from a wire transfer, cash, gift card, or through cryptocurrency. These forms of money transfer are untraceable and, most likely, unrecoverable.
1. Pretending to Be a Government Employee
Scams involving impersonation of a government employee is on the rise. Scammers target people who may need government assistance or have filed for assistance. The scammers are smart. They often spoof phone numbers of the agency they claim to represent. State agencies often lack appropriate security to prevent data breaches, so your information can be at risk to scammers. If you get a call from someone claiming to be a government agent, the first thing to do is to run a reverse phone search on the number that appears on your phone’s caller ID. If the caller is convincing, ask for a phone number so you can return the call. Ensure that the number is attached to an official agency, by checking for contact information on the agency’s official website.
When it comes to websites, verify that the site ends in .gov, instead of any other extension. Also pay attention to misspellings in the URL.
2. Pre-Recorded Calls
Pre-recorded calls have become increasingly popular. Scammers use robocallers to play pre-recorded messages to consumers. The message makes false claims about financial assistance, asking the victim to call a phone number or visit a website to apply or get more information. The message may state that the number and website belong to a state or federal agency, bank, or a government program in charge of unemployment assistance.
Never call the number or visit the website, both will lead to phishing attacks. Block the number from your phone and delete any messages you’ve received via text or email.
3. Fake Stimulus Checks
Along with unemployment insurance fraud, the FTC and Better Business Bureau have reported a dramatic increase in the appearance of fake benefit payments. Scammers may attempt to get your bank information so they can use direct deposit to put the fake stimulus check into your account. Another method is to send a fake check through the mail. The scammer will ask for a payment to send the check or claim that the amount of the check exceeded what the victim was due. The victim is asked to simply return the overpayment instead of destroy the check and wait for a new one. Of course, when the victim goes to deposit the check they find that it is fraudulent.
4. Scam Websites
Scammers develop websites to fool people into entering personal information for their gain. The sites may appear to be an official government webpage focused on helping people during the Coronavirus pandemic. The site will also contain forms and applications that can be submitted for financial assistance. Scammers use the information to drain bank accounts and commit identity theft.
Always use official government websites and verify the sites are legitimate before filling out information or setting up an account. This is especially true for sites requiring information for unemployment insurance claims.
5. Fake Emails and Phishing
Displaced workers may receive emails designed to collect and use information. The emails, which are nothing more than phishing emails, require the recipient to fill out information to have access to unemployment benefits. The emails mirror emails sent by legitimate government agencies like the Department of Labor. They may include copycat headers and footers to make them seem more official.
Red flags to watch out for include:
- Directing you to an unrelated website to fill out an application.
- Asking questions that are unrelated to the claim.
- Requiring you to download an app or documents.
- Asking for sensitive information including your Social Security number and documentation from your financial institution.
If you receive such an email, report it as spam and delete it from your mailbox immediately.
6. Impersonating the Small Business Administration (SBA)
The Small Business Administration (SBA) offers several programs to provide financial assistance to small businesses adversely affected by COVID-19. Unfortunately, con artists take advantage of the programs and impersonate SBA workers to commit identity theft and trick people into paying for information or support.
The Office of Inspector General published information about actual programs offered by the SBA. Anyone claiming otherwise is a fraudster. Keep the following things in mind if you get a call from someone claiming to be calling on behalf of the Small Business Administration:
- SBA does not initiate contact on 7(a) or disaster loans, grants or other benefit payments.
- Suspect fraud if the caller asks for upfront payment or offers a high interest bridge loan.
- SBA limits broker fees to 3% for loans $50,000 or less, 2% for loans $50,000 to $1,000,000, with an additional 0.25% on amounts over $1,000,000.
Questions for the SBA should be directed to 800-659-2955 or they can written via email at firstname.lastname@example.org.
7. Fraudulent Employment Websites
Many people are desperate to get back to work. Numerous fraudulent employment websites promise to connect workers with jobs. Oftentimes the job seeker is asked to pay a fee for an interview or supply personal information.
8. Fake Recruiters
Much like job seeker websites, fake recruiters contact people with job offers. The offers are usually too good to be true and therefore don’t exist. The recruiter requires a headhunter fee or information that can be sold for a profit. If a recruiter asks for a headhunter fee they’re a scammer. Legitimate recruiters are paid by the company they work on behalf of once a job seeker has successfully been placed in a position. Additionally, check on sites like LinkedIn for information on the recruiter or recruiting firm they claim to be from.
9. Smishing Scams
As unemployment benefits claims increase, so do smishing scams. Smishing is the act of getting information through text messages. Text messages may include offers for loans, expedited services relating to unemployment benefits, or other services. Delete the messages immediately and block the number from your phone.
10. Fake Resumes
This scam targets companies more than the unemployed. People seeking employment typically submit a resume to many online job postings. Knowing this scammers and hackers often weaponize resumes, attaching viruses and spyware to attachments. Never download a suspicious looking file from an unknown contact.
How to Report an Unemployment Scam
Fraud alerts from the FTC show only a small percentage of phone scams get reported, and fewer report a financial loss. It’s difficult to say how many scams go unreported due to a lack of information or embarrassment.
If you think you have been targeted by any of the unemployment scams described above, report it online through the FTC’s Complaint Assistant. Include as much information as possible, including the time and date of the call, the alleged agency and representative’s name. Also note any phone numbers or instructions given by the caller. If you have been the victim of identity theft or unemployment benefits fraud, you should also report it to your state’s Attorney General.
Be Cautious and Speculative of Too Good to Be True Opportunities
There seems to be no immediate end or quick fix to the current situation. Being unemployed is difficult for a myriad of reasons and scammers prey upon unsuspecting individuals and businesses. Do the best you can to avoid being scammed by keeping yourself educated and being cautious, especially when the offer you’re receiving is too good to be true.
Make sure you research any offers of financial aid or job opportunities that come your way. If they contact you via phone and you have an iPhone you can download CallerSmart’s reverse phone lookup app to search mysterious numbers that call you and help warn others about potential scams. If you don’t have an iPhone, you can still warn others and look up unknown phone numbers on our website.