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Unemployment Insurance Fraud

It is considered fraud when an individual or employer knowingly misrepresents material facts that allow someone to collect unemployment insurance (UI) benefits when he or she would otherwise be disqualified. Fraud also occurs when tax liabilities owed to DEW are misrepresented.

Click here to report fraud

Do you know someone who is receiving UI benefits:

  • at the same time he or she was incarcerated. 
  • but not reporting he or she is working and being paid cash “under the table.”
  • and not reporting his or her earnings to DEW.
  • but not able or available for work due to illness, injury, out of town, etc.
  • who’s engaged in self-employment.

Do you know of an employer who is:

  • paying individuals cash to avoid paying taxes on these individuals.
  • paying individuals as independent contractors that need to be categorized as employees.
  • filing employer-filed claims for individuals while still paying individuals for working.

Consequences of Committing Fraud

DEW partners with the SC Attorney General to fine and prosecute UI fraud. If you are found guilty of UI fraud, you will be disqualified from receiving benefits for up to 52 weeks. Providing false information is a crime and subjects you to legal action with fines up to $100,000 and imprisonment up to 10 years.

You also will have to pay back any overpayments received as a result of incorrectly reporting wages. This might mean DEW intercepting your state and federal income taxes and the withholding of future wages to settle the debt.

Read more about overpayments and DEW’s income tax interception programs here.


Resources

 

Prevent Unemployment Insurance Fraud

DEW needs your help preventing UI system abuse. Your participation strengthens DEW’s efforts to ensure S.C. employers’ tax dollars are spent wisely, and UI benefits only go to eligible individuals.

 

For individuals

You can prevent fraud and strengthen the integrity of the UI program by taking the following actions:

 

  • Accurately report the reason you are unemployed. 
    Accurately report your reason for separation from your job when you initially file your claim for benefits.
  • Report any wages you are earning.  
    You must report your gross wages for each week you work. Report on all earnings – including part-time or temporary work. Learn more: Reporting Your Wages video tutorial.
  • Actively search for work.
    You must search for work each week or benefits may be denied.
  • Avoid errors and ensure proper payment of benefits.
    To prevent errors that may result in an overpayment, read all of the information in the Claimant Handbook.
  • Stop filing weekly claims as soon as you begin working.
    As soon as you begin working, simply stop filing a weekly claim. Do not wait until you receive your first paycheck.
  • Know your responsibilities and ask for help.
    Navigating through the UI system can be confusing.  If you have a question, claims representatives are here to help. Call TelClaim at 1-866-831-1724 and press option 3 to speak with someone weekdays from 8 a.m. to 4 p.m.

 

For employers

You can prevent fraud and help strengthen the integrity of the UI program by taking the following actions:

 

  • Review quarterly charge statements. 
    At the end of each quarter, every employer receives a copy of all UI benefits charged against their account for that quarter. Please review all benefit charges carefully. Benefit charges will affect your unemployment tax rate at a later date. If you disagree with any of your benefit charges or find any errors, you must protest the charges within 30 days of the date of notice. You may submit your protest online using the Employer Charge Protest portal.
  • Report all new hires to the S.C. New Hire database.
    The New Hire Reporting Program is a database administered by the S.C. Department of Social Services (DSS) and used by DEW to identify individuals who are working and collecting UI benefits. Reporting new hires helps keep UI tax costs down by ensuring that only individuals who are eligible receive UI benefits. Become an active participant in preventing overpayment of UI benefits by reporting all of your newly hired and rehired employees on the S.C. New Hire website.
  • Respond to Separation Requests
    When a former employee files for UI benefits, you have the opportunity to supply information to DEW regarding the reason the individual is now unemployed. You must respond to the department within 10 calendar days of receiving the notification in order to prevent a former employee from wrongfully receiving UI benefits. For more information on how to respond to a separation request visit the UI Benefits page.
  • Respond to Wage Audit Notices 
    Each week DEW cross-checks wage and new hire databases with the unemployment benefit recipient database in order to identify individuals who may have improperly received unemployment benefits while being employed. Claims with potential for conflict are audited via Wage Audit Notices that are sent to the current employer of the individual in question. Wage Audit Notices should be completed and returned within 10 calendar days. Read more about Wage Audit Notices here.
  • Provide accurate wage information.
    Providing DEW with accurate wage information for your workers ensures that individuals are paid the correct amount of UI benefits.
  • Refrain from engaging in tax manipulation schemes. 
    Under the experience rating system, employers pay unemployment taxes at rates proportionate with claims activities by their employees. Employers with high unemployment activity pay higher unemployment tax rates, and employers with lower activity pay less. Employers who engage in SUTA Dumping or other tax manipulation schemes to avoid paying their fair share unfairly shift their costs to other employers.
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Tools


Report fraud using the information listed below.

Online: Fraud Report Form portal

Fraud Hotline: 1-800-868-1488 (toll free)

Address:
S.C. Department of Employment and Workforce
Fraud Investigation Recovery Enforcement Unit
P.O. Box 995
Columbia, SC 29202

Fax: 803-737-0422

When reporting, provide as many details as possible regarding the fraud you’re reporting including:

  • The name, address, Social Security number (if available), or individual or business suspected of committing fraud.
  • The business’s name and address involved with the allegation.
  • Specific dates surrounding the allegation, hours or times worked, and specific details that help substantiate the allegation.

Note:
You do not have to provide your name or identifying information to file a fraud allegation unless you want to. Any contact information provided remains confidential.




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