March 26, 2012
Maine efforts to reduce unemployment fraud and benefit overpayments were cited as a best practice at a national summit on Unemployment Insurance (UI) Integrity sponsored by the U.S. Department of Labor and the National Association of State Workforce Agencies. Maine was one of eight states cited for best practices in efforts to prevent, detect, and recover improper benefit payments.
In June 2011, the U.S. Department of Labor mandated that state unemployment systems take quick action to target overpayment and benefit fraud. At the time, Assistant Secretary of the U.S. Department of Labor, Jane Oates, sent Maine program guidance urging “an immediate call to action… to develop state specific strategies to bring down the UI improper payment rate.”
Maine responded by implementing a new automated cross match with a national database of new hires. The system allows the state to identify unemployment claimants who may be working outside the state of Maine and not reporting earnings to the Maine Unemployment Insurance Program. In the short time the cross match has been in place, it has identified over 400 cases of individuals that were filing for unemployment benefits after starting new jobs with employers out of state.
Within the next two months, Maine will add a new automated wage verification system and a cross match with the Department of Corrections to prevent people who are incarcerated from receiving unemployment benefits. Funding for these efforts have come from Federal Unemployment grants targeted specifically at preventing improper unemployment benefit payments.
These new systems enhance other controls already in place to detect overpayments, including a cross match with the state directory of new hires and queries of employer payroll information. The Department of Labor collaborates with Maine Revenue Services and the Maine Workers’ Compensation Board to identify and prevent fraudulent activity.
“Unemployment provides a critical safety net for workers who have lost their jobs through no fault of their own,” said Maine Labor Commissioner Robert Winglass. “Our efforts to prevent improper payments will help ensure those benefits will be available to people who are truly qualified to receive them.”
Legislation under consideration now would prevent any claimant who has committed unemployment fraud on three separate occasions from collecting unemployment in the future. A provision in the legislation would allow the state labor commissioner to grant exceptions to the prohibition in unusual circumstances.
For more information or to report improper benefit payments, visit: www.maine.gov/labor/unemployment/fraud.html or call 207-621-5100.