Jobless benefits unreachable for many Coloradans in need after state crackdown on fraudulent claims

Colorado's crackdown on rampant unemployment fraud across the state is backfiring against the people it's intended to help most.

Driving the news: Scores of out-of-work Coloradans filing authentic unemployment claims are being flagged as fraudulent after the state's labor department ramped up its fraud detection software to the "highest possible level" this past spring.

• The heightened security followed the pandemic sparking a slew of new scams, including widespread unemployment payment schemes. The state improperly paid about $73 million in fraudulent jobless benefits in 2020.

State of play: Colorado's extra safety measures have caught thousands of fraudulent claims, according to state officials, but they're also having major unintended consequences.

• People are having to deplete what little is left in their savings accounts and take out loans to cover their costs while they wait for assistance to arrive.
• Meanwhile, they can't seem to get in touch with anyone who can help. The state's call reps can't provide specific details on individual claims to prevent private information being shared with bad actors, the Department of Labor and Employment told the Denver Post.

What they're saying: "The process is broken," Tony Martinez told 9News in August. Martinez began receiving money in March after losing his tech job, but the money stopped in June after the state put a hold on his account.

• "Not knowing when you're going to get help is the hardest part," he said, noting that his homeowners association was getting ready to put a lien on his condo.

What's next: State officials are adjusting security filters and working to identify legitimate unemployment claims in an effort to release the holds on them in large batches.

Yes, but: How quickly relief will come for Coloradans in need remains uncertain.