State Comptroller: Unemployment insurance has too many delays and overpayments

NASHVILLE, Tenn.(WVLT)--Fraud and errors lead to $73 million in overpayments in state's unemployment insurance program over the past six years.

State auditors found the department’s internal controls for the program were ineffective or non-existent. The department’s efforts to review fraudulent claims and claims paid in error and to collect overpayments were also strained.

The department has only been able to collect 23% of the overpayments on average.

In addition, auditors found that people who were actually eligible for benefits did not receive them in a timely manner. Due to increased backlogs in the department’s claims process, some benefit payments were delayed for those who needed help.

Those are among the findings of the state’s Single Audit Report, which was released today. The Single Audit Report is an annual audit of state agencies and universities’ compliance with federal requirements.

State auditors concluded that management’s failure to properly administer this state/federal program jeopardizes the integrity and future viability of the program.

“The state’s unemployed citizens must be able to rely on the Department of Labor and Workforce Development officials to properly administer the unemployment insurance program and provide critical benefits to those who are dependent on them,” Comptroller Justin P. Wilson said. “The new acting commissioner of the department has responded and initiated a corrective action plan to strengthen controls and establish program oversight. We appreciate the new commissioner’s prompt action as well as the former commissioner’s request for a review of specific allegations when she identified fraud risks within the department.”

In all, the report contains 48 findings with recommendations for improvement at 11 different state agencies and universities

To view the Single Audit Report online click the link.

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