Unemployment fraud is of particular interest to the states and the government because stealing money from those who need it is a violation of the law. Unemployment insurance fraud may be committed by employers or claimants.
Claimant fraud may include issues such as submitting false information or collecting benefits despite no longer being eligible. Intentionally failing to submit wages or collecting an income can lead to claims of fraud. Unemployment fraud committed by employers could include avoiding tax liabilities or creating a false employer account to make claims against it.
How can you be penalized for unemployment insurance fraud?
The penalties can be severe, including a fine of no less than 15% on top of the amount of the fraudulent payment. In some cases, you may face criminal prosecution, incarceration, the forfeiture of future tax refunds or complete and permanent loss of eligibility for unemployment. Either state or federal courts can hear cases on employment fraud.
What should you do if you’re being investigated for unemployment insurance fraud?
If you are suspected of committing unemployment fraud, it’s a good idea to work with your attorney to defend yourself from the beginning of the investigation. Talk to them about what you should or should not say to the police or others who wish to speak with you. Make sure your attorney stays apprised of any new information or requests that others make of you during the investigation.
Every state has its own rules and regulations regarding unemployment insurance fraud. If you’re concerned about an investigation into your unemployment benefits or would like to learn more about your defense options, our website has more information.