August 12, 2014
FOR IMMEDIATE RELEASE: August 12, 2014
Contact: Julie Rabinowitz, 207-621-5009
Collected benefits while employed
AUGUSTA— Tracy Young of Portland, Maine was convicted on July 28, 2014, of theft by deception for fraudulently receiving unemployment insurance payments.
Young, age 49, worked and earned wages while collecting benefits. He was sentenced to three years and one month in Maine State Prison with two years of probation for two counts relating to unemployment fraud. He has paid restitution of $2,587.
“Unemployment fraud takes money away from people who are genuinely in need,” said Governor Paul R. LePage. “Fraud also burdens the businesses that pay the unemployment taxes that fund the benefits. The Department of Labor is actively reviewing the data to identify fraud and referring cases to the district attorneys.”
“Unemployment benefit fraud involving principal amounts of $1,000 or more are considered felonies under Maine law. We continue to aggressively move felony cases to prosecution,” stated Commissioner of Labor Jeanne Paquette.
The Department of Labor actively pursues the collection of benefit overpayments and any associated fines and interest. The collection process usually begins by contacting claimants to request repayment or establish a repayment schedule.
As of July 31, the amount of fraudulent payments recovered in 2014 through prosecution totals $63,496.60. That same amount for all of 2013 totaled $67,501.01. Eighty-eight fraud cases are pending with district attorneys. In 2012, a total of 15 cases were referred to district attorneys for prosecution, resulting in five convictions. In 2013, the department referred 88 cases.
“Fraud prosecution and prevention is a priority for the department. In the past two years, we’ve improved our reporting systems. We now receive information from employers faster and perform better cross-matches against employment and other databases to identify potential fraud. These efforts are paying off and send a strong message,” Commissioner Paquette said.
Commissioner Paquette explained what constitutes fraud. “For people claiming benefits, unemployment insurance fraud usually involves someone misrepresenting information to qualify for benefits,” she said. “In this case, an individual continued to claim benefits after returning to work. In other cases, individuals might report that they are looking for work when they are not, or they might report having contacted employers in their search for work that they did not actually contact. Some may file claims under false pretenses.”
To identify when people receiving benefits are hired for permanent work, the department cross-matches the list of active claimants against the National Directory of New Hires and against employer-reported quarterly wage data.
On the employer side of the unemployment system, fraud includes intentional misclassification of employees as independent contractors, misreporting worker wages to avoid payment of unemployment taxes and “SUTA dumping,” a rate manipulation practice for obtaining a lower tax rate than a company’s unemployment experience would otherwise allow.
Citizens can report instances of suspected unemployment fraud by phone, email, fax or mail; information is available at http://www.maine.gov/labor/unemployment/fraud.html . Tips can be kept confidential.