Wednesday’s Post 11.23.11 – The state of New Jersey has saved nearly $60 million through their anti-fraud effort launched March this year, according to state officials. The anti-fraud Program was part of the state’s campaign to cut down on wasteful spending in fraudulent unemployment insurance payouts. A lofty endeavor.  New Jersey’s Department of Labor and Workforce Development, or LWD, carried out a reorganization of its Fraud and Risk Prevention Unit. The department crossmatched government hiring data and has identified 76,000 questionable claims between the months of April and September. It has also prevented payment of about 35,000 people who made unemployment insurance claims but were still working a regular job. The success of the anti-fraud campaign earned the LWD the Unemployment Insurance Innovation Award for Integrity, given by the Office of Unemployment Insurance under the U.S. Department of Labor. The award was given in October of this year for being the only agency in the country to take an aggressive move towards preventing the most common kind of insurance fraud.

The LWD’s Assistant Commissioner of Income Security said in a statement that unemployment insurance fraud cases would take several weeks to discover after the payments had been improperly collected. Thanks to the anti-fraud campaign, “now, we catch them in the first week”.  This saves the tax payers a lot of money.  The crossmatching system works by flagging any new hire date detected when one tries to certify their insurance checks, both by phone or online. Once the system indicates this, the person is then required to clarify or resolve the discrepancy with a representative of the LWD, or else the insurance payments will not be given out.  Labor Commissioner Harold J. Wirth, in full support of the anti-fraud system, stated that cases of fraud result in “a tax increase on the people”, and that the state would spend too much time and money on tracking down people to recover the fraudulent payments.

The crosschecking system is only one of a number of innovative programs launched in the Fraud and Risk Assessment department of the LWD. It also uses the Unemployment Insurance State Information Data Exchange System in identifying fraud cases as the system works to standardize and automate any information collected from employers when any employee leaves their work. With this data, the state of New Jersey has managed to crack down on unemployment fraud using an exact and reliable database of employee records.

-Mike

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602