Feds recognize N.J. effort in fight against fraudulent unemployment insurance claims

The state has received an award from the U.S. Department of Labor for its effort to combat unemployment insurance fraud.

The state has received an award from the U.S. Department of Labor for its effort to combat unemployment insurance fraud.

The federal Office of Unemployment Insurance gave the state the Unemployment Insurance Innovation Award for Integrity on Oct. 19.

State officials estimate that the anti-fraud effort has protected taxpayers against an estimated $56 million in fraudulent UI payments.

“Our anti-fraud effort has been focused on stopping fraud in unemployment insurance before it happens, by making sure people do not collect money they are not entitled to get,” said state Labor Commissioner Harold J. Wirths.

The state Labor Department reorganized its fraud and risk-prevention unit earlier this year. According to state officials, it is the only agency in the nation to use an aggressive campaign of cross-matching government hiring data to prevent payments to people who are no longer eligible for benefits because they returned to work. This is the most common form of UI fraud, according to state officials.

The anti-fraud program prevented an estimated 35,000 people from fraudulently collecting payments between April 16 and Sept. 3, state officials said. Before the new program, the state couldn’t discover fraud until employers filed quarterly wage and new-hire reports. This method also didn’t include employers located outside of New Jersey.

Ronald Marino, assistant commissioner of income security, said this has cut the time that those committing fraud are caught.

“Now, we catch them in the first week,” since improperly filed claims are flagged when checked against new-hire dates, Marino said