The U.S. Inspector General's office is investigating what could be a multi-state unemployment insurance fraud scheme that resulted in Massachusetts paying out at least $280,000 in fraudulent claims since March, according to state officials.

The Executive Office of Labor and Workforce Development became aware of the suspicious patterns within the past two weeks, and officials say benefit payments obtained fraudulently have been stopped. An additional 500 claims were blocked before payments started, preventing $9.3 million in costs to the state had they gone undetected.

"I don't know if they know it's one individual or one entity but there are patterns that suggest it might be contained. These things are serious, but we also feel we have identified it and we expended very little before we were able to cut them off at the knees," Labor and Workforce Development Secretary Rachel Kaprielian said.

The Inspector General's investigation involves claims made in Massachusetts, as well as Kansas, Nevada, New York, Texas, Florida and New Mexico, a state labor official said. In Massachusetts, just fewer than 600 fraudulent claims tied to the investigation have been made since March out of a total of 61,000 new claims filed with the state.

"We are notifying the effected residents that erroneous claims have been filed in their name and are preparing guidance for employers to alert us to potentially fraudulent claims. We count on them to help us verify," said Ann Dufresne, spokeswoman for the Executive Office of Labor and Workforce Development.

The scheme, according to Dufresne, involved perpetrators stealing the identities of Massachusetts residents and using their personal information to make claims for benefits, which can be collected for up to 30 weeks.

Kaprielian stressed that the department is unaware of any data breach within the state's unemployment insurance system database that could have exposed the personal information of residents lawfully collecting benefits. She also said it appears the claims may have been originating from outside Massachusetts, but cannot be certain at this time.

The state is working closely with the Inspector General and the other states involved so that whoever is responsible can be identified and prosecuted, officials said.

"We definitely have the gate up, but every now and again we have to be vigilant because they can get trickier or clever," Kaprielian said. "The integrity of the system is key to its success and I feel confident saying this is a system with integrity."

The office uses a fraud detection program called AWARE that can be used to track electronic patterns within claims filed with the department that could point to potential fraud. Since the program was launched in November, the administration has uncovered and shut down other schemes that Dufresne said saved taxpayers $24.6 million.

Kaprielian said she believes the system works, even in this case when fraudulent claims were being filed as far back as March. "It's hard to tell on a onesie-twosie fraud. You need to see a pattern developing," the secretary said. "But just because we've stopped this one doesn't mean we can relax. The cyber world is always changing and we have to be ready for the next step."

Original Source at The Seattle Times

Life insurance has been called a euphemism for death insurance, but who wants to think about it that way? The important thing is that you think about it, and get insured, if needed.

* A primer on life insurance, from the Boston branch of the Better Business Bureau, explains the many kinds of policies. The guide explains the different kinds of insurers and notes you must read the actual policy before buying.

* Bankrate.com writer Jay MacDonald explores the "myths about buying life insurance."

James Hunt, with the Consumer Federation of America, recommends term life and 401(k) investments as an alternative to whole-life policies, saying, "The problem is, 40 (percent) or 50 percent of the buyers drop out within 10 years and never get a good return on their money."

* Tips at Forbes.com explain more about term insurance. "If you are in a situation (where) your dependents will not rely on you financially forever, your best bet is probably a term-life policy," writes contributor Jessica Bosari. "Once kids are [financially independent], there is no reason to continue paying for life insurance."

* You can look up Standard & Poor's ratings for companies at Insure.com, an independent insurance website.

* ConsumerReports.org advises caution even with a well-rated company. This article gives guidelines for deciding if ratings are trustworthy and how to evaluate the financial health of an insurance company .

Fronting' - trying to hide who is actually the main driver of a car - isn't just a little white lie

According to new research from Privilege, 6% of motorists are falsely listing themselves as the main driver on a car insurance policy.

It's known as 'fronting', but there could be grave consequences if your insurer finds out.

The rise of fronting

Fronting is a way to cut the car insurance costs for the real main driver. It's typically parents that utilise it, as their child will face a far more expensive policy if they are named as the main driver. Instead, the parent claims to be the main driver, with the child simply a named driver.

If the 6% figure from the Privilege survey is replicated across the nation, that would work out at more than two million motorists!

Incredibly a further 3% (or one million drivers) have been named on policies for a vehicle they have never even driven.

Why we are tempted

It should be no surprise that so many people are tempted by this 'little white lie', as the cost of car insurance for young people is extraordinary. And that's even when you take into account the fact that it has fallen significantly over the last 12 months.

In April the AA published its latest Shoparound analysis of car insurance, where it combines the five cheapest premiums it could find from a range of sources. Here's how car insurance premiums look for the different age bands, and how they changed on both a quarterly and annual basis.

As you can see, even though car insurance premiums for the youngest drivers have dropped by more than 20% over the last year, they are still around four times more expensive than the over 30s. Faced with a bill like that, is it any wonder that telling your insurer what appears to be a little fib becomes ever more tempting?

The danger of fronting

The problem with fronting is that it is a form of fraud. Should the insurer discover it has been misled, penalties include claims being refused and policies being cancelled with no premiums refunded. In some cases there could be fines, penalty points, even the possibility of losing your licence.

It will also prove more difficult - and therefore more expensive - to arrange cover in future.

Some people view fronting as a harmless way to save a few quid on their car insurance. In truth, it's anything but.

Cutting your car insurance costs the right way

There are plenty of ways to cut how much you pay for your car insurance without resorting to fraud. Here are just a few:

* Never auto-renew: you should always shop around to ensure you are getting the best possible deal. Opting to auto-renew can cost you an extra £200 a year!

* Increase your excess: the excess is the amount you pay towards any repairs when you make a claim. By increasing the excess, your should pay less in premiums. Just don't ramp it up to an unaffordable level.a

* Improve your car's security: parking off-road or in a garage, and installing an immobilizer or alarm to your car will make it more secure and therefore cut the cost of your car insurance.

* Pay it all in one go: most insurers will offer you the chance to pay off your insurance policy each month rather than in one go. But you'll pay a massive rate of interest to do so. You're better off getting a 0% credit card to cover the costs, and spreading the payments that way.

* Tweak your job title: bizarre as it sounds, the job title you use when applying for a policy makes a difference to the cost. For example, my quotes work out cheaper if I put my job down as editor than if I put journalist.

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