AUSTIN (Nexstar) — When Sean Aragon lost his job earlier this month, he hoped to take advantage of the state’s unemployment benefit system. Instead, someone tried to take advantage of him.

When Aragon, who was most recently a project manager for a mechanical, electrical and plumbing company, applied for unemployment benefits through the Texas Workforce Commission, he was notified someone had already applied for benefits using his information— two months before he lost his job.

“They said, ‘Well, sir, you already have filed twice with us, so this is not new account,’ like ‘Oh, man, no, I didn’t file twice,'” Aragon said.

“It’s that sinking feeling where you go ‘Oh, great,'” Aragon said, describing his reaction to finding out his information was compromised.

“There’s nothing you can do about it,” he explained. “You have to just sit back and work the problem, and work with the Texas Workforce Commission.”

The Texas Workforce Commission has identified, confirmed and logged over 3,500 identity theft fraud claims since January, an agency spokesperson said this week. That accounts for .07% of overall claims submitted.

“This is a small number but a big deal for the people that may have their identity or unemployment insurance benefits stolen,” agency spokesperson Cisco Gamez said.

TWC has a high-risk suspicious claim detection tool on the front end to review claims when they are filed, Gamez said. If a claim is deemed high-risk, the claimant must contact TWC’s Office of Investigations to be identified before the claim will proceed.

“Even though our tool is very good, it doesn’t detect all fraudulent claims,” Gamez said, encouraging employers to respond to suspicious claim filings as soon as possible, which allows investigators to identify whether the fraud is related to a single claim or part of a larger scheme.

An agency audit identified suspicious activity on some users’ accounts, TWC reported last week.

Texas has paid out over $25 billion in unemployment insurance claims since mid-March, the agency confirmed Thursday.

“We know that nefarious actors are targeting that money,” TWC Executive Director Ed Serna said in a prepared statement this week.

“All fraud is a betrayal of the taxpayers and a shameless exploitation of the suffering of others for the fraudster’s personal gain and we take aggressive steps to identify it, prevent it and stop it,” Serna stated.

Gamez said the agency is notifying potential fraud victims and working with law enforcement authorities as part of these investigations.

He said the unemployment system itself is not compromised.

In Aragon’s case, the fraudster did not get the financial payout.

“Thankfully I didn’t get to that point on my case because they caught up before any payouts were done, but how many people out there weren’t so lucky, and they have those charges sitting out there right now that they don’t know about?” Aragon said.

According to TWC, penalties for fraudulent behavior may include fines up to $4,000 and jail time, including “forfeiture of benefits received and the right to benefits that remain in the claimant’s benefit year.” Previous criminal prosecutions relating to unemployment insurance fraud can be found on the TWC website.

TWC established a Fraud and Program Abuse Hotline to report suspected fraud, waste, or program abuse. Texans can call 800-252-3642 to reach that hotline 24 hours per day, seven days per week. The agency also has additional warnings for jobseekers about scams and unemployed Texans who may receive calls from someone pretending to be a TWC representative. TWC has also published information for Texans who believe their information may be compromised.