DAYTON — Ohio cases of unemployment insurance fraud have more than doubled since the recession began as an increasing number of claimants continue to collect benefits even after they return to work.
The state has recovered more than $42 million in improper payouts over the past five years, mostly from workers who lied about their employment status on unemployment benefits claims, said Ben Johnson, a spokesman for the Ohio Department of Job and Family Services.
“There are certainly more elaborate ways in which people attempt to defraud the system,” Johnson said. “But the most common way is that someone who is legitimately receiving unemployment benefits gets a job and is required to notify us that they are no longer unemployed, but they do not.”
Last year, the state recovered about $10 million in fraudulent payments, which was a small fraction of the $5 billion in total state and federal unemployment benefits paid to displaced Ohio workers.
But fraud has become an increasingly burdensome drag on the state’s unemployment compensation trust fund, which has already been forced to borrow money to keep up with payouts and still owes the federal government $2.6 billion, Johnson said.
“We don’t think fraud is endemic in the system,” he said. “But we’re not so naïve to think that fraud is not a problem, and we want to root it out because fraud jeopardizes the program for people who really need it.”
Ohio is not alone.
Unemployment fraud is so widespread that the U.S. Department of Labor has formed a task force to address the problem.
Ohio is one of 11 “high-impact’’ states — or states with the highest dollar amount of improper payments — participating in the task force, said Johnson, who noted the task force is part of a broader federal effort to reduce erroneous Medicaid, unemployment and food stamp payments.
“We are engaged with other states in focusing on how to reduce payments made after a claimant returns to work … and how to reduce improper payments that stem from separation adjudications,” he said, referring to cases in which, for example, claimants lie about their eligibility by saying they were laid off when in fact they were fired for cause or quit.
Johnson said it’s no coincidence that in addition to Ohio the task force is comprised of states with some of the highest unemployment rates in the country, including California, New York, Pennsylvania, Illinois, Michigan, Florida, North Carolina, Texas, New Jersey and Wisconsin. – Source