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Chase Bank flags legitimate Oregon unemployment checks as fraud, blocking people from their money

The employment department said Chase is freezing or closing accounts of people who received unemployment because of an algorithm flagging the checks as fraud.

PORTLAND, Ore. — More people receiving unemployment money from the Oregon Employment Department (OED) have contacted KGW Investigates with complaints they can’t access money in their Chase Bank accounts.

Karen Krader and her family members couldn’t access their money for days until KGW contacted Chase Bank about the issue. Krader had been receiving unemployment for months after getting laid off from her office job in February. Chase said her account had been flagged over fraud concerns even though she was legitimately receiving funds from OED.

“I feel like Chase is treating us like criminals and we’re not criminals,” said Krader.

Amber Purcell said Krader’s story mirrored her own.

“It’s what happened to me, exactly what happened to me,” said Purcell.

Purcell said she could not access her funds for three months because Chase flagged her account for fraud.

Leandro Garduno, another Chase customer, said his account was also flagged after depositing his OED checks. Garduno applied from unemployment in March but didn’t receive his checks until last week. He thought his account was flagged because he deposited more than one dozen checks at once.

“I thought it was because of that and then I learned it was happening to people who deposited just one check,” Garduno said.

People reported similar problems in Washington this summer. The unemployment claims for nearly 200,000 Washington workers had been flagged because of a massive unemployment impostor scheme. Officials reported scammers stealing between $550 million to $650 million in unemployment benefits.

Purcell said innocent Oregonians are clearly being impacted by these fraud alerts too.

OED reached out to Chase Bank after KGW Investigates alerted them to the issue. An OED spokesperson said in an email, in part:

"We've spoken with Chase personnel in their Fraud prevention department and have learned that due to the high volume of checks we are issuing, they are getting flagged by an algorithm as fraud. We heard from some fraud staff that they have reported the trend but have not seen any changes to procedure or their programming. When we are contacted by a claimant with this kind of issue, we do address it as quickly as we can, whether it means connecting with Chase or making a change on our end."

Chase Bank issued a statement that said:

“As reported, the government is investigating potential fraud relating to unemployment insurance benefits. To protect us, our customers or to meet legal requirements, we have restricted some account(s) pending further review.”

A Chase Bank spokesperson said they are investigating these new claims.

Do you have a story for Cristin to investigate? Email her at CallCristin@kgw.com.