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Audit finds more details in unemployment overpayment and fraud

By: Andy Chow | Jo Ingles | Statehouse News Bureau
Posted on: Thursday, October 28, 2021

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COLUMBUS, Ohio (Statehouse News Bureau) — A state audit says changes to the federal requirements for unemployment compensation and a lack of controls led to the state doling out $3.8 billion in overpayments and fraud for jobless claims.

State Auditor Keith Faber (R-Ohio) says there were nearly 86,000 potential instances where the payments went to someone in prison and 141,000 potential instances of money going to someone who’s dead.

The audit also says people filed for unemployment under fake names such as “Adidas,” “Dummy,” and “Demon.”

Faber says the Ohio Department of Job and Family Services did not have the proper security system in place to prevent scams and that other state agencies need to pay attention.

“We can’t have major payment systems that don’t have the proper security protocols in place, that don’t have the controls in place to stop untoward actors,” Faber says.

Ohio’s unemployment program took on a huge influx of submissions during the COVID-19 pandemic. And Ohio Department of Job and Family Services Director Matt Damschroder admits the state’s unemployment system simply wasn’t equipped to respond to the massive changes. He says the state had already begun the process of getting a new system prior to COVID.

“We are in the process of implementing that system that will be cloud-based, much more scalable, modern coding language and those kinds of things to be able to respond to increased demands in that system in the future,” Damschroder says.

Many Ohioans who needed unemployment during the pandemic couldn’t get it on a timely basis if at all.