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Unemployment Fraud Statistics Don't Tell The Whole Story

Derek Wang

Last year, the number of people who scammed Washington state's unemployment benefits system hit a three year high. State officials announced the findings Tuesday. But that doesn't necessarily mean that fraud is on the rise.


The latest numbers from state officials say seven thousand people fraudulently collected a total of $14 million in 2010. In some cases, people collected jobless benefits under the names of family members who were dead. In other cases, people who were already receiving compensation for being injured on the job were improperly collecting benefits. And then other cases were a little more complicated.

Annette Taylor is the chief investigator for the State Employment Security department. She alleges that some cases were especially egregious, and she cites one particular man.

Taylor: "He would receive his unemployment insurance checks, he would take a picture of those checks and deposit them into his bank account. He works with a bank that allows that. And then he would actually go and cash those checks at a different establishment, so he'd be redeeming those checks twice."

Taylor says at least 13 people could face criminal charges out of the pool of seven thousand. All the people in question will have to pay the money back, or they'll face fines and possible jail time.

The number of fraudulent cases is at its highest point in three years, but Taylor stresses that that doesn't necessarily mean that fraud is increasing. It could mean that the state is getting better at detecting it.

She says in the previous year the state was swamped with applications. Some investigators were taken off fraud cases to pitch in with getting checks out the door.

Taylor: "We had some of our staff re–assigned in 2009 to meet the mission of the agency — to make sure benefits were being paid out to those who needed it. There were times in 2009 that our resources were strapped due to meeting the agency's mission."

Now the investigators are back to looking for fraud. And now they're armed with new technology.

In 2009, the State started upgrading its computer software to help detect fraud. Taylor says the state had to throttle back on investigations so staffers could train with the new system. And she says by 2010, her office was more familiar with the technology.

I'm Derek Wang, KUOW News.

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