Employment Identity Theft: How To Tell If You're a Victim

What Is Employment Identity Theft? How Bad Is It?

Employment identity theft is a type of identity theft that occurs when someone uses your personally identifiable information (PII) — such as your name, date of birth, address, and SSN — to pose as you when applying for jobs.

In most cases, criminals commit employment identity theft because they can’t legitimately get a job due to their citizenship status or checkered work history. For example, they might have a criminal record or other issues that make it impossible for them to get hired. Using your employee information, they can pass background checks and get a job.

In an extreme case, a single SSN was being used for jobs at 15 employers in 14 different states, over a three-month period [*].

Consequences of employment-related identity theft:

• You could owe taxes on money you didn’t earn. Any income that a scammer earns using your identity will be added to your annual tax burden. For example, if someone made $40,000 using your identity, you could owe taxes on that money.
• The IRS might audit you. To prove that you’re a victim of identity fraud and not trying to cheat the system, the IRS might initiate an audit. Audits can be lengthy and expensive, even if you’ve done everything right in filing your tax returns.
• You could lose your Social Security benefits. Your benefits may be reduced or revoked because your income looks much higher than it actually is due to income falsely attributed to you.

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How To Tell If Someone Is Using Your SSN (or ID) for Employment

Employment identity theft is notoriously difficult to spot. However, there are a few obvious red flags that can suggest someone is using your name to gain employment. 

Here are eight signs that you’re a victim of employment identity theft:

1. You receive IRS notices (W-2s or 1099s) for wages you didn’t earn 

Employers must file Form W-2s and Form 1099s with the IRS for every employee who fits certain criteria (i.e., employees who have either had taxes withheld, or have been paid a certain amount). If you receive one of these forms from an employer or government agency that you didn’t work for, it’s a sign that your identity has been stolen.

What to look for:

When you receive an IRS notice, check that:

• The employer’s name, address, and ZIP code are correct.
• The employee’s name or SSN is yours.
• The amounts reported are accurate.

If any of these aren’t what you expected, contact your employer for verification. If they didn’t submit the W-2, contact the Social Security Administration (SSA) immediately and report the suspected identity theft.

2. Your Social Security benefits get denied

Your Social Security Statement provides estimates about retirement, disability, and survivor benefits for which you’re eligible. It also shows your income history.

If your identity has been used to gain employment, you may receive a notification from the Social Security Administration (SSA) stating that your benefits have been adjusted or denied. You may also receive a notice from the SSA showing higher earnings than you expected.

What to look for:

To check if your Social Security Statement is accurate:

• Sign in to the SSA website (or create an account).
• Review your statement and check that your income history and predicted benefits are accurate.

If any information is incorrect, you need to contact the SSA to correct your Social Security earnings record.

3. The IRS sends you a notice that your identity may have been stolen

If the IRS notices any discrepancies in your tax return, they may send you one of the following three forms:

• CP01E - Employment Related Identity Theft. You will receive the CP01E form if the IRS believes that someone has used your SSN to obtain employment.
• CP2000 - Request for Verification of Unreported Income, Payments, or Credits. The IRS will send the CP2000 notice if your tax return doesn’t match the information they received from employers and financial institutions.
• CP2057 - Check Your Records to Confirm the Income you Received. The CP2057 notice is sent when the IRS receives information that you haven’t reported on your tax return.

You may also receive a notice that an online account has been created in your name or that your account has been accessed or disabled without your permission. 

All of these forms are signs of employment-related identity theft, but the CP01E is the most critical as it means that your SSN is under investigation by the IRS. If you receive any of these forms, contact the IRS to receive further information about what to do next. 

📚 Related: How To Protect Yourself Against Tax Identity Theft →

4. You can’t file your tax return because of a duplicate SSN

If you try to e-file your tax return and the attempt is rejected due to a duplicate SSN, this might mean that someone else has used your information to submit a tax return already. 

To make sure:

• Check that you entered your name and SSN correctly on the return.
• Double-check that you didn’t e-file a tax return already.
• Ensure that no one else could’ve claimed you as a dependent on their tax return — your return will be rejected in this case.

If your information is correct and no one has submitted a tax return for you that you know of, you need to contact the IRS immediately at 800-829-1040.

📚 Related: The 13 Latest Tax Refund Scams To Be Aware Of (2023) →

5. You’ve been assigned an Employer Identification Number (EIN) that you didn’t request

An EIN is like an SSN, but for a business. EINs are unique, nine-digit identifiers assigned to businesses by the IRS for tax purposes. If an EIN has been assigned to you, the first thing to do is check to see if it was done for a legitimate reason.

Third parties who can request an EIN on your behalf include:

• A spouse or family member.
• An association or community club.
• Your accountant, business partner, or business associate.
• Another third party acting on your behalf, like an executor of a trust.

If none of these third parties would have requested an EIN for you, your identity may have been used to apply for an EIN. You should contact the IRS immediately at 800-908-4490 and consider submitting a Form 14039-B, Business Identity Theft Affidavit. 

6. Your SSN monitoring service informs you of misuse

Aura monitors your most sensitive information — including your SSN — for signs of fraud or identity theft. For example, if someone opens a bank account using your SSN, Aura will alert you so that you can close the account immediately.

If someone has stolen your SSN to commit employment fraud, they’re likely using it for other purposes, too.

For example, your SSN monitoring service may inform you that:

• There is unauthorized activity in your credit file.
• Your SSN is for sale on the Dark Web.
• Someone has opened a bank account in your name.
• Your SSN was used to apply for a passport or driver’s license.

Check if your SSN is on the Dark Web or being used by criminals. Try all of Aura’s features free for 14 days →

7. There are unrecognized background checks on your E-Verify account 

E-Verify is a service that verifies whether a person is legally employable. If someone has stolen your identity to obtain work, E-Verify may have been tasked with checking your background for the potential employer. 

However, employers can only request a check between the time a job applicant accepts their offer of employment and the third business day after the employee has started work. So, if you notice a background check outside of this time, someone has probably stolen your identity.

How to check:

You can verify your personal information and case history using myE-Verify. To do so, log in to myE-Verify and select “Case History.”

Here, you will see all of the instances in which employers have checked your employment status over the last ten years. If these don’t match your employment history, it’s likely that someone has stolen your identity.

8. You receive an unexpected unemployment award letter

A Notice of Unemployment Insurance Award is granted when you file for Unemployment Insurance (UI) using your SSN. If you receive this notice but didn’t file for UI, it means someone used your SSN to commit unemployment fraud.

The fraudster may also apply for other benefits including food benefits, welfare, temporary assistance, and Medicaid. 

If you receive unemployment benefits, you should also receive an IRS Form 1099-G, Certain Government Payments. This form is used to report the benefits on your tax return. If you receive a Form 1099-G but didn’t receive any of the payments listed, it’s a sign that someone is using your SSN to receive benefits in your name.

📚 Related: How To Identify Medicare Scam Calls →

What To Do If You’re a Victim

If you’re the victim of employment identity theft, you need to act immediately to prevent further damage. Start by making a list and contacting any service or business where your SSN is being fraudulently used — including employers you don’t work for or benefits you didn’t request.

If you have an Aura membership, our 24/7 Fraud Resolution specialists can help you contact these organizations and even facilitate three-way calls.

After you’ve minimized the damage, you can begin recovering from the consequences of identity theft:

• Freeze your credit with all three credit bureaus. If identity thieves have your SSN, they could use it to apply for new credit cards or take out loans in your name. A credit freeze stops anyone from accessing your credit file and opening new accounts. Here’s how to request a credit freeze with all three bureaus.
• Report the fraud. You need to report the fraud in several places. File an official identity theft report with the Federal Trade Commission (FTC). Then report the fraud to your employer. Consider filing a report with local law enforcement. And if your situation involves unemployment fraud, consider reporting it to the Department of Labor. Keep any confirmations that you receive.
• Scan your credit report and bank statements. Make sure there’s no suspicious activity or incorrect information on your financial accounts. If there is, notify your bank and the three credit reporting agencies — Experian, TransUnion, and Equifax — and let them know that you suspect your identity has been stolen.
• Contact the SSA to correct your earnings record. Contact the SSA and review your earnings with them. It may take several weeks for them to update their records.
• Get an Identity Protection PIN (IP PIN). An IP PIN is a six-digit code that you include with your tax return to confirm your identity with the IRS. This minimizes the chance of identity theft because fraudsters are unable to electronically file tax returns without it. Here’s how you can obtain an IP PIN.
• Submit a Form 14039 with your tax return. If you’ve tried to submit a tax return and it was rejected because of a duplicate SSN filing, you should submit a Form 14039, Identity Theft Affidavit. This will inform the IRS that you may be a victim of identity fraud, enabling them to check and clear the fraudulent return.
• If someone claims unemployment in your name, contact the state’s unemployment office. If you received a Notice of Unemployment Insurance Award or 1099-G with unreceived payments, contact your state’s unemployment office immediately.

How To Protect Yourself

• Safeguard your personal information — especially your SSN. Protecting your personal data is vital if you want to prevent scammers from targeting you. You should only share your SSN when it’s absolutely necessary.
• Claim your E-Verify account. If you’ve never created an E-Verify account, someone may have done so in your name to pass an employment eligibility check. Contact E-Verify and change your login credentials to lock out the unauthorized user; then look to see whether there are unexplained checks in your case history.
• Lock your SSN. E-Verify has a self-lock feature that prevents employers from checking your work eligibility. This was introduced as a measure to prevent employment-related fraud, and lasts for one year upon request. Here’s how to self-lock your SSN.
• Update your online accounts with secure passwords and 2FA. Securing your online accounts prevents fraudsters from accessing them even if they have all of your personal information. To protect your accounts, use strong, unique passwords for each account and turn on multi-factor or two-factor authentication (MFA or 2FA) if available.
• Look out for the warning signs of a phishing attack. Phishing scams are designed to trick you into sharing your personal information. Learn how to spot the signs of a phishing attack and remember the golden rule: never click on links in unsolicited emails or texts.
• Consider signing up for identity theft protection. Aura protects your online accounts, monitors your most sensitive information for signs of fraud, and watches your bank, credit, and investment accounts for suspicious activity. And whenever you need immediate assistance, Aura’s team of 24/7 fraud resolution specialists is there to help.

Don’t Let Con Artists Ruin Your Reputation

Employment-related ID theft can happen to anyone. Rather than waiting for it to happen to you, consider signing up for Aura’s identity theft protection solution.

Aura monitors your SSN and sends you a fraud alert in near real-time if anyone is targeting you or your family for identity theft. 

Don’t get burned by employment identity theft. Try Aura free for 14 days →