At a State Senate Oversight Committee meeting Monday evening, Labor Department Director Scott R. Jensen said that some of the stolen money was from the state’s unemployment insurance trust funds, but most has been from federal funding.

Unemployment insurance fraud has been a problem across the country, but Jensen said Rhode Island is better positioned than most states to address it. The department’s switch to a new operating system in April helped it handle the higher volume of claims and detect sophisticated fraud.

“We would have been a catastrophic [failure], so we went to the Cloud,” said Jensen. “Rhode Island, because we have gone to the Cloud, is probably nine months ahead of everybody else. But the country is really experiencing some challenges in its UI systems across the board.”

State Police Captain Robert A. Creamer said that there had been approximately 44,000 unemployment insurance fraud claims since the beginning of the pandemic. In the last few weeks, Creamer said they receive 800 to 1,000 complaints a day. 

In late March, Jensen said there was a significant spike in fraud. He credits this to the opportunity: more government money available and the overwhelming amount of unemployment insurance claims coming in as the pandemic struck. 

Fraudsters have been able to get access to personal information like social security numbers, making it hard to determine what claims are fake.

“They present with stolen personal identification, so it is really difficult to tell a real person from a fraudulent person because the information the fraudsters present is absolutely real,” said Jensen. “It’s the right social security number, it’s the right date of birth, often it’s the right workplace.”

Creamer said fraudsters likely got this personal information from cyber breaches.

“You have to make the assumption that your personal information is out there,” said Creamer. “Secure accounts with strong passwords and update or change those passwords on a regular basis.”

Creamer said the FBI is now involved in investigating these fraudulent claims since they suspect the bad actors are not just Rhode Islanders and may not even be in the country. 

Scott Jensen said that despite the widespread fraud, the trust fund can still pay for unemployment benefits during the COVD-19 pandemic that has wreaked havoc on the economy. The state has approximately $150 million at its disposal.

“We haven’t gone into the red yet like about a third of the states in the country have,” said Jensen. “We haven’t had to borrow from the federal government in order to pay benefits. Legitimate claimants [are] able to get the benefits they so badly need.”

People can report instances of fraud on the Labor Department website.