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Ohio unemployment fraud reaches at least $332 million -- much higher than originally forecast

Numbers could rise with claims under review
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Posted at 5:58 PM, Feb 03, 2021
and last updated 2021-02-04 09:00:42-05

CINCINNATI — Ohio lost at least $332 million to unemployment fraud in 2020, according to figures released by the Ohio Department of Job and Family Services Wednesday.

But that number will almost certainly rise, as it is based on figures disclosed to the U.S. Department of Labor that do not include potential fraud cases still under review.

“That represents fraudulent overpayments that we have moved all the way through the determination process,” JFS Director Kim Henderson said. “There are a number more that are flagged, working through the determination process right now.”

Henderson did not reveal how many cases are still being reviewed.

Ohio reported 2,200 fraudulent overpayments totaling $2.3 million in its traditional unemployment system between October and December, Henderson said. In the Pandemic Unemployment Assistance program, she said Ohio reported $330 million in fraudulent payments to 56,000 recipients in December.

Henderson also said Ohio avoided hundreds of millions of dollars in additional losses in December by suspending payments to 100,000 accounts determined to be fraudulent.

The Labor Department requires states to report fraud losses in the month they are determined to be fraudulent, as opposed to when the money is actually paid. So, claims still under review could include months of improper payments.

State officials previously said 276,000 PUA accounts were suspended due to suspected fraud. By the end of December, at least 157,000 accounts had been deemed fraudulent. So, that means as many as 119,000 could still be under review.

The I-Team obtained the Labor Department report that includes Ohio’s December disclosure. The $330 million figure was much higher than the $657,000 in fraud reported from April to November. The report also showed total PUA overpayments spiked to $202 million in December, with nearly 33,000 PUA recipients deemed to have been overpaid.

Combining fraud and overpayment numbers since April, the Labor Department figures show Ohio made $833 million in improper payments to 526,000 PUA recipients. Those numbers are much higher than figures reported by Kentucky. It disclosed $160,000 in improper payments to 3,394 PUA recipients. Indiana reported $22.7 million in improper payments to 56,708 PUA recipients.

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