Jobless benefit fraud falls in '09

Although the number of fraudulent unemployment claims in Thurston and Pierce counties fell in 2009 from 2008, the rate of jobless benefits paid out as an "honest mistake" increased in the two counties during the same period, according to state Employment Security Department data.

Last week the agency announced that statewide for 2009 it had detected more than $10 million in jobless benefits obtained through fraud. Year-over-year statewide data were not immediately available, although the 2009 figures do reflect the agency’s efforts to crack down on fraud by cross-matching Social Security numbers with other state agencies, said Annette Taylor, chief investigative officer for the ESD.

In one case last year, the wife of a prison inmate was receiving jobless benefits on the man’s behalf.

“It sounds crazy, but this type of thing is not that uncommon,” she said. “It’s a sign of the times.”

In South Sound, fraudulent jobless claims fell while those received by mistake rose in Thurston, Pierce, Lewis and Mason counties in 2009 from 2008, the data show.

In Thurston County, nonfraud cases rose to 3,215 from 2,465, representing $2.4 million in benefits in 2009, up from $1.26 million in benefits in 2008. Meanwhile, the number of fraud cases here fell to 159 people last year from 191 in 2008, or a drop in benefits to $244,395 from $252,080, according to the data.

More people received benefits through an honest mistake last year likely because of the record number of people who sought benefits, including those who lost their job for the first time and were unfamiliar with the process, ESD spokesman Mark Varadian said.

“The combination is bound to lead to confusion,” he said.

Statewide last year, 475,000 jobless workers received unemployment benefits, up from 290,000 in 2008, ESD data show. An example of someone who received benefits by mistake might be a person with a temporary job, such as painting a house, while collecting benefits and being unaware of the need to report that income to the ESD, Varadian said.

There can be penalties for workers and employers. For example, someone who through no fault of his or her own is overpaid benefits would have to repay that amount and could face 1 percent interest charges if the payment is delinquent for more than 30 days, Varadian said. People or businesses that knowingly commit fraud pay a steeper price.

For an individual, fraud can result in up to two years of having jobless benefits denied, plus repayment and penalties. A business caught trying to manipulate its unemployment tax rate could be assigned “the highest possible tax rate plus 2 percent for at least three years, and must pay audit costs and any related collection fees,” according to ESD.

“We do want people to let us know if fraud is being committed,” Varadian said.

Rolf Boone: 360-754-5403