As the ‘gig’ economy goes into overdrive due to COVID layoffs, employee behavior regarding CryptoCurrency has made a dramatic shift in a surprising direction. While you may assume that investing in bitcoin is on the rise, but that’s only a small part of the story.
CryptoCurrency is being used as a method of payment for persons on unemployment insurance or who have an open worker’s comp claim. Because CryptoCurrency is outside of the taxable income reporting loop, workers can receive a full income stream that is virtually untraceable through traditional means. The most popular app for this exchange is CashApp, followed by Venmo and Zelle.
Here’s what it looks like:
- Worker leaves day to day employment via furlough or injury claim
- Worker hones a hobby of theirs into a marketable skill
- Worker begins selling their services, with payment via CryptoCurrency apps
- Double dip for as long as possible
Just last week our company was in court testifying about an injured worker who had a full-fledged catering business up and running (including the use of a ghost kitchen) while she was on workers compensation. All payments were made via CashApp and we testified that the profile was open and active, but CashApp does not disclose the amounts of money being transferred from one entity to another.
How can an insured or an employer know if a worker is being compensated? The use of crypto currency is often displayed in claimants’ social media profiles. The business that they are running as well as their preferred cryptocurrency app will be available either as announced entities or in comments below photos of the products or services offered.
As the work environment continues to evolve at a record pace, we have seen these CryptoCurrency apps explode in popularity for wide variety of everyday financial transfers – music lessons, food sales, estate sales, swap meets, and arts/craft sales and festivals. We have also simultaneously seen the closure of stores, marketplaces and multiple businesses.
Because of these closures, the main venue for marketing the goods and services developed by claimants is social media. Facebook, TikTok, and Instagram are the new “malls, markets and tradeshows.” So, while cryptocurrency apps make people’s finances less possible to track, their activities online make them much easier to discover. Social media is the common thread that ties everything together.
Therefore, as soon as workers' comp disability claims are made to an employer or TPA, it is more important than ever to start social media surveillance right away to capture the activity (both financial and otherwise) that will reduce claim exposure. The pandemic has moved us further and further online, allowing better and more comprehensive information about claimants via digital surveillance.