News from New York State Department of Labor

For more information contact: Jean Genovese, 518-457-5519

NYS Labor Department Prosecutes Unemployment Insurance Fraud

Agency Identifies Nearly $27 Million in Overpayments in 2007

ALBANY, NY (01/24/2008; 1005)(readMedia)-- State Labor Commissioner M. Patricia Smith today announced that the Department of Labor’s efforts to prosecute Unemployment Insurance (UI) fraud led to 369 convictions throughout New York State in 2007, with overpayments in these cases totaling more than $3 million. Last year the Department’s UI investigators identified fraud in a total of 35,837 cases, worth $26,939,727 in fraudulent overpayments.

“The Labor Department will aggressively combat unemployment insurance fraud to safeguard the integrity of the UI system and to protect law-abiding businesses from individuals that abuse it,” Commissioner Smith said. “We will use every means at our disposal to promptly identify fraud and pursue violators in every corner of the state.”

The Labor Department uses several methods to identify fraud. One highly effective method is the “New Hire” crossmatch, which compares new hires reported by employers with UI benefit claims. This comparison of agency records can spot claimants who collect benefits after they are hired. It is also a valuable tool that can catch fraud in its infancy and prevent thefts from growing. Such prompt action keeps money in the UI fund that would otherwise go out as overpayments.

The Labor Department also identifies UI fraud by reviewing payroll and wage reports from the NYS Department of Taxation & Finance, as well as NYS Department of Correctional Services inmate records, and comparing them against UI records on a weekly, monthly or quarterly basis. The agency also encourages citizens to anonymously report incidents of possible fraud by calling the toll-free number 1-888-598-2077.

In 2007, Labor Department Investigators referred UI fraud cases totaling $1,790,805 in overpayments to district attorneys in the downstate region (Counties of New York, Bronx, Queens, Brooklyn, Richmond, Suffolk, Nassau, Rockland, Orange, Westchester and Putnam), which resulted in 112 criminal convictions. Fraud cases totaling $1,241,899 in overpayments were referred to district attorneys upstate, resulting in 257 convictions.

For more information, visit the Department of Labor’s web site at www.labor.state.ny.us.

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