Labor commissioner says department was hit by large, coordinated attack by fraudsters

Justin Gray
·2 min read
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Georgia’s Labor Commissioner says the state’s unemployment system was hit by a large, coordinated attack by fake companies filing for unemployment on behalf of fake employees.

Now, the state is putting in new protections to protect against this.

Channel 2 consumer investigator Justin Gray learned that the Department of Labor is once again allowing employers to file claims on behalf of employees.

That was on hold most of June after fraudsters posing as employers tried to steal unemployment benefits.

“So earlier this month, essentially, you saw a massive, coordinated attack,” Gray asked Georgia Commissioner of Labor Bruce Thompson

“Yes, sir,” Thompson said. “My team was watching, and we were waiting. And then it hit, and it was significant in a matter of hours.”

Thompson said a series of fake companies with fake employees, all filed earlier this month, for a large number of fraudulent unemployment claims.

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“It was identified, was quantified. It was stopped,” Thompson said.

Ever since the COVID-19 pandemic began, Channel 2 Action News has reported on various fraud schemes and attacks targeting the Department of Labor.

Thompson estimates it could add up to more than $4 billion since the start of the pandemic in fraud just in Georgia.

In January, we told you about the state inspector general flagging 280 state employees for applying for and collecting improper unemployment benefits.

And last year, we told you how federal prosecutors charged two metro Atlanta residents, Shanita Daniel and Wayne Lowe, with filing for unemployment on behalf of fake employees of fake businesses, even filing quarterly taxes for those fake businesses.

Thompson said this new attack was much bigger. The state had to temporarily pause allowing all employer filed partial claims for most of June.

Now, employers are once again allowed to file but only if they can prove they’ve been doing business for at least 5 years.

Thompson said many of the fake companies that attacked this month were formed all the way back at the start of the pandemic,

“They established their businesses, in some cases even paid in benefits to mere legitimate business, but yet had no employees, even though we reported them waiting for the opportunity,” Thompson said.

While it might have seemed like with the pandemic rush of claims over criminals would have moved on from DOL, Thompson said many of the ones involved in this attack have been essentially lying in wait for just the right time to act for years now.

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