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Unemployment delays continue for thousands as state fights fraudulent claims

Unemployment Fraud Issues
Posted at 10:08 PM, Sep 06, 2023

DENVER — Contact Denver7 continues to hear from Coloradans waiting to receive needed unemployment benefits after being errantly flagged as a fraudulent claims.

The Colorado Department of Labor and Employment (CDLE) earlier this year increased its fraud detection measures to the highest possible level in response to a surge in unemployment fraud. This, however, has resulted in thousands of legitimate claims being affected and subjected to months of delays.

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Surge in Colorado unemployment fraud affects legitimate claims

Jaclyn Allen
5:04 PM, Jul 24, 2023

Jon Westgaard in Denver is among those impacted. He reached out to Contact Denver7 after four months of waiting for benefits.

Westgaard was laid off from his company at the beginning of May and immediately filed for unemployment. With a background and career in technology and applications, Westgaard said he has a meticulous eye for detail.

“I double-check things before sending them, and I know that I was spot on with the information I provided,” he stressed.

Westgaard received one payment from CDLE, but then received an alert that there were “pending issues” with his account and he needed to send further identifying documentation.

“I had to prove that I was me. I had to provide everything under the sun — history of addresses, cars I’ve owned,” Westgaard recalled. “It took a while. It was very tedious.”

That was in May. Westgaard hasn’t received any unemployment payments since, despite hours on the phone and online trying to connect with CDLE representatives. Most calls, he said, only consist of the automated system and end instructing callers to try again later.

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A CDLE spokesperson told Denver7 Wednesday there are approximately 4,000 claims currently impacted by fraud holds. This is slightly lower than the 5,766 reported in July, but still constitutes a large number of people struggling to make ends meet.

“…some of these will be confirmed fraud, and some will be determined to be legitimate,” the CDLE representative said. “We continue to monitor, analyze and adjust our processes to determine which holds are low-risk and safe to be released for payment.”

A state audit released in 2021 found that $73 million of unemployment claims paid out during the COVID-19 pandemic were either fraudulent or potentially fraudulent. The CDLE reported another surge in fraudulent claims earlier this year. Westgaard said he “completely understands” the needed to ensure valid payments, but that his wait has been excessive and is negatively impacting his life.

“I have bills that are overdue. My car payments are overdue. We’ve gotten two notices of demand for payment [of rent]. Not eviction yet, but we’re very close,” he said. “I don’t know what to do.”

Editor's note: Denver7 seeks out audience tips and feedback to help people in need, resolve problems and hold the powerful accountable. If you know of a community need we can address or have a story idea for our consumer investigates team to pursue, please email us at contact7@denver7.com or or call (303) 832-7777. Find more Contact Denver7 stories here. You can also use the form below to request help from Jaclyn Allen and the Contact Denver7 Team