COLONIE, N.Y. (NEWS10) — It’s a scam that has resulted in billions of taxpayer dollars being stolen from Labor Department offices across the country. And now many people in the Capital Region are the victims of identity theft.

In Colonie, police say some of the victims are receiving phone calls from suspected scammers.

Colonie Police Lt. Dan Belles says the department was inundated last week with calls from residents saying they had received letters — some from New York and even other states — saying the recipient had qualified for unemployment benefits they never filed for.

The callers are now believed to be among a growing number of victims in a widespread identity theft scheme.

“They are pretty similar in that they got things in the mail that they weren’t expecting from the Labor Department. No one seems to know how their information was compromised,” said Lt. Belles.

The issue began with past data breaches, some going back years with institutions such as banks, insurance companies and employers.

Bad actors collect, buy or share the stolen personal information, which they then use to file for unemployment benefits under someone else’s identity.

It’s unclear exactly how the bad guys, many whom operate overseas, are able to collect the payments.

Consumer protection groups such as NYPIRG suspect that the benefits are likely being collected through electronic transfers. But Lt. Belles says, in Colonie, there’s also a different twist going on.

Some victims told police that they were actually receiving phone calls from unknown people asking for information on debit cards mailed to them by the Department of Labor.

“It seems like that is the way the suspects are monetizing the scam,” said Belles.

He warns not to use the cards if you receive them and never filed for unemployment benfits. He says you should instead report anything suspicious to police who are taking reports and forwarding them on to the Department of Labor.

If you have received a letter or feel your identity has been compromised, you are advised to do a few things right away, including reporting identity theft and filing a fraud report.