As Ottawa steps up efforts to detect and deter fraud in its billion-dollar COVID-19 personal income support programs, some Canadians say their benefit payments have been on hold for weeks due to delays in the government’s identity-check process.

“I’m feeling extremely anxious, … like I don’t know how this is gonna go,” says Paul, a master’s student at the University of Ottawa, who says he hasn’t been able to collect his Canada Emergency Student Benefit (CESB) since mid-June.

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When Paul — whose real name Global News has agreed not to use — logged online to re-apply for the CESB, a bright blue banner on the dashboard of his Canada Revenue Agency (CRA) account told him to call a validation and identity protection service line, he says.

But despite speaking to three different agents in the following week who said the CRA would follow up to verify his identity, Paul says that still hasn’t happened. Five weeks later, his application remains blocked, he says.

“I wonder how many thousands of people are like me, just sitting there wondering, ‘What the hell?’”

Paul, who lives with several mental health disabilities, says he’s counting on the federal aid to make up for income lost due to the coronavirus pandemic.

He was transitioning out of school into working in the mental health sector when the pandemic hit, and nearly all of his work went up in smoke, he says. He first applied for the student benefit program in May and received the maximum $2,000 amount because of his disabilities.

The May payment helped pay the bills, Paul says, and after his work barely picked up in June, he decided to apply again. But as he awaits the fate of his second payment, he’s stretching out what’s left of the first.

Global News agreed to use a pseudonym for Paul because he keeps his disabilities private and worries they might impact his career prospects.

Many others claiming to be applicants or recipients to the CESB or the Canada Emergency Response Benefit (CERB) have reported similar delays and concerns about the CRA’s validation and identity line on social media.

Ottawa resident Joe Doucet, for example, says the system blocked him from re-applying for the CERB for the same June 7 to July 4 pay period.

Doucet, a tech support worker who says he lost work in March due to the pandemic, says he had applied for and received the $2,000-per-month benefit for the previous three pay periods without a hitch.

Doucet says it took more than a month to resolve the issue, despite dialling up the CRA validation line every single day starting on June 10.

Initially, calling the government’s 1-800 number would connect him with agents who would take his name and telephone number and promise a callback, he says.

“First it was within two to five days, then three to 10 and then they stopped giving time frames,” he says.

Concerns about identity theft, organized crime

The reports of payment delays come after the federal government increased efforts to weed out fraudulent applications from its CERB and CESB programs, which the Finance Department expects will cost taxpayers more than $85 billion.

When it rolled out the programs, Ottawa opted for attestation-based applications, with the system designed to automatically approve funding, in an effort to quickly deliver emergency funds to millions of Canadians left without income amid the pandemic.

Federal officials said applicants’ eligibility would be reviewed later, suggesting they weren’t worried about high fraud levels.

But concern about scams has increased in recent weeks. In June, the CRA told a House of Commons committee it had already detected a number of potentially fraudulent applications for benefits, including from people believed to be involved in organized crime.

“The CRA recently implemented controls requiring certain applications to be validated before they are processed,” the agency told Global News in a statement, confirming it launched the toll-free validation and identity protection service line in early June.

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Canada’s federal tax agency faces a difficult job trying to come up on the fly with a system to prevent a potentially significant outflow of funds to criminal entities while at the same time ensuring that all legitimate applicants can access the benefits they’re entitled to in a timely manner, says Elizabeth Mulholland, chief executive officer of Prosper Canada, a national charity that focuses on improving economic opportunity for Canadians living in poverty.

On the one hand, the government needs to act quickly to combat the criminal activity, Mulholland says.

“It’s not about catching somebody who is $100 off on how much they received,” she says. “It’s about making sure that we’re not hemorrhaging tens, if not hundreds, of millions of dollars due to a systematic effort by organized crime to tap the system while it’s still fairly open.”

Waiting until tax time next year to conduct in-depth reviews of applications for individual pandemic-aid programs would likely be too late to recoup any funds lost to organized crime, she adds.

On the other hand, the government must make sure legitimate applicants aren’t cut off from funding for prolonged periods of time when they may have no other way to pay the bills, Mulholland adds.

“People are relying on these payments to pay their rent and buy food in many cases,” she says.

“We really do need to make sure that we’re not harming honest Canadians while we go after the crooks.”

Normally, the CRA relies on algorithms to flag potentially fraudulent benefit applicants, says Mulholland, whose organization has helped the CRA address issues around fraud detection in the Canada Child Benefit program.

“Typically, you would tweak your algorithms over time, as you realize, ‘We cast the net too broadly. … We’re catching too many people who are not doing anything wrong’,” Mulholland says. But that’s a difficult, time-consuming process, she adds.

“Modest review of claims should be feasible at the application stage while maintaining efficiency for all applicants,” says Joseph Devaney, director of VideoTax.com, a national tax educator for accountants, in an email to Global News.

The speedy processing of claims reviews requires direct phone lines to CRA agents, adequate staffing levels, clear reviewing instructions for agents, and the ability to easily access support, Devaney says.

“If CRA can provide these pillars, I don’t see why a moderate amount of application stage review couldn’t take place efficiently,” he says.

CRA acknowledges jammed phone lines

In a statement to Global News, the CRA acknowledged the toll-free validation line “has, at times, been receiving higher volumes,” and that some callers haven’t been able to get through as a result.

“In other cases, we may not have been able to respond in a timely fashion to some callers, who were expecting a callback from us,” CRA spokesperson Etienne Biram said in the statement.

“We are diligently working to adjust this service to ensure applicants can receive timely and efficient service, without the need to call back.”

The CRA wouldn’t say how many of its agents are assigned to the identity validation line, but said it has “added additional phone lines and more employees to increase our capacity to process files more quickly.”

When callbacks are required, the agency said it “prioritizes the work based on the applicant’s situation” and some applicants may receiving their follow-ups more quickly as a result.

The agency wouldn’t say how many identity validation checks remain to be done for people who applied for the June 7 – July 4 benefit pay periods.

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In a previous statement to Global News, the CRA confirmed the validation phone line is operated by the agency and not by a third party.

The CRA has said it has received several thousand fraud-related tips for three federal COVID-19 emergency aid programs.

Early in June, the Liberal government was unable to get unanimous support from the opposition parties to pass legislation that included fines and possible jail time for CERB fraud.

‘It made me feel like I was the bad guy’

Paul and Doucet both say their experience with the validation system has left them feeling like they are being accused of cheating the system.

Doucet says he finally got through to an agent on July 14. He says he’s been told his account had been flagged because he had recently updated his banking information. The flag has now been removed, he adds.

He says he understands the CRA is trying to prevent and catch fraudulent claims but wishes he hadn’t been left “in the dark” for so long.

“Without knowing what I know now, it made me feel like I was the bad guy,” Doucet says.

Paul is still waiting for his June monthly payment and says he still doesn’t know why his account was flagged as “suspicious,” as he claimed he was told by a CRA agent.

He feels “really let down” by a program that was promoted as the government’s way of having Canadians’ backs during a difficult period.

“There’s no transparency. There is no accountability. I can’t get anybody on the phone,” he says.

“It feels like a bait and switch or a dupe or something.”

He says he’s not going to rely on the emergency benefit again, even though business is still slow and he hasn’t figured out yet what to do once the CESB money is gone.

“No matter what, I’m never applying again.”

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