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Spike in unemployment claims 'likely fraud,' Colorado's labor department says

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Robert Davis | The Center Square

(The Center Square) – Colorado had a significant increase in new unemployment claim filings last week compared to the week prior, an increase the Colorado Department of Labor and Employment (CDLE) attributed in part to fraud.

In all, 41,439 new unemployment claims were filed the week ending January 2, up from 25,360 new claims filed the week ending December 26. CDLE attributed the increase to several factors, including quarter change, seasonal filings, and claim reopens. However, the agency said Thursday that "the majority are likely fraud due to abnormalities in the data."

“As reported earlier this week, the increase in reports of UI fraud is likely connected to the expiration of CARES Act programs," CDLE said. "Reports of UI fraud by victims have increased proportionately with the increase in regular UI claims.”

Health care and social assistance workers made up the largest group of claimants, filing 2,070 claims together. Education services and construction workers were the second and third-largest groups, making up a combined 3,900 claims.

To date, Colorado has paid $2.5 billion in regular unemployment claims, and another $1.05 billion in PUA claims, according to CDLE data. The state also spent $2.5 billion on federal relief payments provided by the CARES Act.

Since mid-March, a total of 773,558 regular initial unemployment claims have been filed in Colorado. When federal PUA claims are included, the total increases to 1,025,482.

Analysts at WalletHub calculated these totals represent a 1,503% increase in year-over-year unemployment claims, ranking Colorado’s recovery the second slowest in the U.S.

When compared to the beginning of 2020, last week’s unemployment claim totals represent an increase of 1,717%.

CDLE announced earlier this week that its online claims portal will be down until January 10 "in preparation for the launch of a new benefits system."