Government Waste – Inmates Collecting Millions In Fraudulent Unemployment Checks

from FOX News –

They’re behind bars, but you’re still paying their “salaries.”

State and federal officials say inmates across the country continue to collect millions each year in fraudulent unemployment benefits — often the result of oversight — with the most recent case in Pennsylvania, where more than 1,000 people collected benefits while behind bars.

Pennsylvania officials said this week the fraud occurred in county prisons because they failed to implement a system of cross-checking the Social Security numbers of benefit applicants, like they did with inmates in their state and federal prisons.

Republican Gov. Tom Corbett said his administration is correcting the problem. But the 1,162 inmates had already collected about $334 every week for more than four months, costing taxpayers roughly $7 million.

The state labor department said detecting the fraud is more difficult now that benefit checks — once intercepted in inmates’ mail — have largely been replaced with direct deposits to bank accounts. And the biweekly phone calls to renew benefits can be made by a friend or relative at home.

Overall unemployment fraud is now at 2.85 percent, according to the Labor Department. The agency doesn’t have a specific number for fraud payments but said overall improper payments cost taxpayers $4.9 billion from July 2011 through June 2012, the agency’s most recent reporting period.

The problem is hardly isolated to Pennsylvania. The states with the highest fraud rate over that period were Arizona at 9.21 percent; Mississippi at 9.05 percent; Louisiana at 8.29 percent; South Dakota at 5.95 percent; and Pennsylvania and New Mexico tied at 5.22 percent. The total amount of improper payments was roughly $890 million.

A recent audit in South Carolina purportedly shows the state is also paying unemployment benefits to inmates as well as children, dead people and residents of other states.

State Sen. Kevin Bryant said the percentage of claims could be as high as 25 percent. However, Bryant, a Republican, said Wednesday the sample audit was performed by a private firm and the findings cannot be released unless the state’s Department of Employment and Workforce hires it for a full audit.

In Arizona, officials purportedly found 475 inmates collected roughly $1.1 million in 2010 and 2012. To detect the fraud, the state’s Department of Economic Security used the same Social Security cross-referencing that Pennsylvania was using in state and federal prisons since 1997.

Arizona officials, like others across the U.S., are trying to recoup the money through such methods as offsetting future benefits and taking tax refunds.

A U.S. Labor Department spokesman told the U.S. fraud rate continued to drop as the agency looks for new ways to detect scams, “but the goal is to insure taxpayers are not being impacted by improper payments and fraud.”

He also said New York is working on a pilot project that officials hope will find new ways for states to improve oversight efforts.

AMAC continues to monitor Government Waste and keep you updated.


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Lynn Burkhart
9 years ago

I came across this published article that may be of interest to all:

This article brings out alleged transfer of US secrets to China.

Carmen Perez
9 years ago

Being that we know the problem exists now then something should be done inmediately.

Richard D Fremin Sr
9 years ago

The politicans are going to keep filing their pockets on our dime UNTIL we get enough of it and kick everyone of their asses out onto the street.And take away their “benefits”,and I mean ALL of them,every penny,nickle,dime,and most of all the DOLLARS each and every one of the crooks have stolen from us (the hard working American people).They Know who they are. There isn’t one of them, and I mean ONE that could look any of us in the eye and tell us it isn’t so.But then again they probably could,for that is how they started stealing from us in the first place. Shame on you ALL because you will all have to meet your maker. There is one thing you SOB”S can be thankful for,and that is be glad that I am not your JUDGE,JURY, and EXCUITIONER.

9 years ago

Managers of such waste and incompetence in the private sector would be at a minimum fired and could be prosecuted depending upon the type of fraud. Has anyone in

9 years ago
Reply to  Almay

the government been fired? if not why not?

9 years ago

Many years ago I questioned fraud among welfare beneficiaries and was told that it would cost too much to investigate everyone on welfare. It would have been a lot cheaper then to set up a system to investigate fraud than all the money that has been paid out to those who have committed fraud since then. Plus, it would have given people jobs. Also, people in prison who are committing fraud should have to pay it back. What is being done about that?

9 years ago

With corruption and ineptitude rampant at every level of government, this shouldn’t surprise anyone. Of course with a 95% re-election rate for politicians, does anyone need an explanation of who’s really to blame?

9 years ago

Why do prisoners get anything while in jail,they gave up their rights,and all this by a Government that wants to get BIGGER?They cannot do anything now!

9 years ago

Yeah add to their sentence and we pay for their housing and meals. Some of these people who determine who is eligible should be made to take responsibility for their actions. I know from past experience many do not want to “rock the boat” and let these people slide. Job security? for whom? It is pitiful when the taxpayers have to foot the bill.

Gary Ross
9 years ago

“But the goal is to insure taxpayers are not being impacted by improper payments and fraud.” You’re joking, right? How about the difference between right and wrong? And what about that lazy federal or state employee who is guilty of this soft word called “oversight”?

People are in jail and prison for a reason. They are a danger to society. You bet they will sniff out any advantage they can to get something for nothing, and they don’t care who it hurts in the process. The problem is not them. We all know where they stand.

9 years ago

It doesn’t seem like it should be too hard to chase down these criminals. They should all be prosecuted for fraud and have time added to their sentence. Seems that would be strike in the good behavior category too.

9 years ago

And thats why they all voted for Obama.

9 years ago
Reply to  bxarmybraat

I’m pretty sure felons can’t vote. it’s the people outside the bar who were stupid in voting

9 years ago
Reply to  mamamay

mamamay- I’m also pretty sure- that felons’ votes are being counted! They may not be personally voting, but you can bet someone’s voting in their place, and 99% are voting dimocratic. Courtesy of the dimocrats who don’t want voter ID’s.

9 years ago
Reply to  mamamay

BTW, which bar are you outside of?

M. Tristan
9 years ago

Well put and very true!!!

9 years ago

As this article correctly points out, this problem has been going on for years. Government is NOT set up to be efficient or proactive. It is, by its very nature, designed to move simply money from point A to point B in the most expedient manner. The process itself usually supersedes any other concerns.

Safeguards against potential fraud don’t rate very high on the list of priorities. The primary objective of any government administrator is to NOT have his or her phone ring. A ringing phone means a potential problem and a problem means potential accountability for something. Raising one’s visibility is to be avoided at all costs. The goal of most career bureaucrats is to spend 25 to 30 years “flying just below the radar” and then retiring with a government pension. Looking to identify fraud or security holes in the process is NOT something most senior administrators set out to do.

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