Colorado unemployment fraud tops $73 million: audit

DENVER (KDVR) – A state audit shared with Colorado lawmakers on Monday found that $73 million in unemployment benefits may have been improperly sent to people who don’t deserve it.

The $73 million figure, if confirmed, would be more than double the $30 million that the Colorado Department of Labor and Employment previously acknowledged in fraudulent payments.

State Audit Office The report find:

  • $3.9 million was paid on behalf of the deceased;
  • $5 million was paid to the prisoners;
  • $18.5 million was paid to people with suspicious bank accounts;
  • and $102,000 was paid to those who were not of working age.

The state’s unemployment department director, Phil Spesshardt, told FOX31 that the state has received 1.4 million jobless claims flagged as potentially fraudulent, making it very difficult to weed out any bad guys.

“Do we believe there is some of it that we would ignore cheating? Certainly, none of the tools we’ve used are perfect,” said Spesshardt.

But Spesshardt said Colorado has performed better than many states. California, with a population seven times that of Colorado, has previously reported unemployment fraud of at least $20 billion. And even a much smaller state like Kansas reported $380 million in unemployment fraud, the auditors reported.

Thousands of unresolved complaints after many months

The audit also found that most customer complaints were never resolved, although the state’s employment department said they could have been resolved but were not properly documented to prove it. prove it.

The audit uncovered 196,000 unresolved customer complaints from people whose claims were held on suspicion of fraudulent activity. That was 73% of the total 266,000 customer complaints and even 70,000 complaints were resolved taking an average of 7 weeks to reach a resolution.

But Spesshardt told the Resolver that he believes 192,000 of the 196,000 claims may have been resolved but lack documentation, such as a settlement date, to the satisfaction of state auditors.

However, he admits many of the 4,000 unresolved customer complaints have gone unresolved for months, let alone a payment to someone who may be desperate for unemployment benefits. their.

“I don’t want to wait a year, I don’t want six months, I don’t want to wait 30 days,” Spesshardt said. contact CDLE.

Unemployment fraud figures released to lawmakers in audit on December 6, 2021 (KDVR)

Spesshardt said one of the biggest problems tends to be misappropriated claims, where an individual with a legitimate claim could have been tricked into clicking a link from a fake scammer. is a customer service agent from CDLE. When an innocent person clicks on a link, the scammer gets that person’s personal information and takes over the account.

“Those things require much more in-depth analysis, and this requires human intervention to review and investigate those claims. Unfortunately, the amount of staff available to do that continues to be a struggle,” said Spesshardt.

He estimates the state has about 50 employees dedicated to investigating unemployment fraud but says that’s not nearly enough, given the number of fraudulent claims.

Colorado runs out of unemployment money

FOX31 continues to receive emails from viewers with unresolved complaints, including one sent to the Issuer during Monday’s audit hearing.

Viewer wrote:

I’ve been trying to get out of unemployment since 3/19/21, I did everything they asked for and I’m still running. One person even told me that it usually takes 3 months and here mine is a year. Can you help me with the answer? Excuse me… I’m at the end of my wits.

FOX31 viewers show

“We are pushing the unemployment department to be able to address these issues and help people get their lives back on track,” said Dafna Representative Michaelson Jenet, D-Commerce City, chair of the legislative audit committee. state, said.

Colorado ran out of unemployment funds months ago and had to borrow about $1 billion from the federal government to continue paying unemployment insurance for those who qualify.

https://kdvr.com/news/local/unemployment-fraud-colorado-audit-dec-2021/ Colorado unemployment fraud tops $73 million: audit

Emma Bowman

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