State Agency Cracks Down on Fraudulent Unemployment Claims

May 6, 2012

The state's jobless numbers may be dropping, but an office created last July to root out unemployment compensation fraud says its work is not slowing down any time soon.

Jim Tillman is head of the Office of Integrity in the state Department of Labor and Industry. He said new tools to prevent online fraud are being added to an existing program to keep people from collecting unemployment benefits when they return to work.

"Just because the unemployment rate goes down doesn't mean that we're going to decrease our effort in combating UC fraud," said Tillman. "It is a significant problem nationwide and we remain committed to combating it."

One major new tool will allow the agency to check a database of newly-hired Pennsylvanians to see if any are still claiming unemployment.

"This would be for people who become employed and then fail to report to [the agency] that they got a job, and they continue to collect unemployment benefits — which is our biggest contributing factor to overpayments," said TIllman.

The Department of Labor and Industry already checks state prison inmates for fraud, but Tillman said new computer software will allow the agency to look into county jail fraud as well.

The DLI also developed a tool to cut down on fraudulent unemployment benefits claims originating from other countries.

"In about a month's period, we established around a thousand hits from 115 different countries," said Tillman, "so we are currently blocking those claims which would potentially be a savings of several million dollars."

The commonwealth's unemployment rate has dropped too low for the federal government to allow extended unemployment compensation benefits to continue. The last of those will be paid this week.

Last year, Pennsylvania paid about $3 billion in unemployment compensation benefits, of which $31 million was identified as fraud. Pennsylvania's error rate is still below the national average.