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Labor: More than 389,000 cases of potential unemployment fraud pending investigation

By CAROLINE BECK, Alabama Daily News

MONTGOMERY, Ala. – Alabama currently has more than 389,000 cases of potential unemployment fraud pending investigation, according to the Alabama Department of Labor.

The department has previously said it has blocked more than $5 billion in unemployment benefits from being sent out since the beginning of the COVID-19 pandemic in March 2020.

ADOL has said most of the concerns of unemployment fraud were surrounding the federal programs like the Pandemic Unemployment Assistance fund, or PUA, that were approved under the 2020 CARES Act because many of the normal checks and balances were not required for those programs.

During a recent meeting of the Legislature’s contract review committee, Sen. Bill Beasley, D-Clayton, said he had experienced calls about unemployment fraud and asked for an update on how the state was handling that problem.

A representative from ADOL at the meeting said that those problems had stopped significantly after the pandemic relief programs were cut off in June.

The representative said he believed 60,000-70,000 cases had already been investigated and that the department is currently working with local district attorneys and the state’s attorney general’s office in handling the cases.

A $1 million contract was also approved for ADOL during that meeting that allows services to continue with ASK Telemarketing for another year to provide online or telephone support for claimants, the number of which spiked in 2020.

The ADOL representative explained that while they aren’t having to deal with as many unemployment claims as they were at the beginning of the pandemic, they are still dealing with a large amount of calls from people appealing their claims that have been delayed.

“It could be a simple thing like changing a pin number, because some of these people may or may not still be on benefits but they may still have problems or questions with an appeal that they have filed that has not yet been heard,” the representative said during the meeting.

With this new amendment, the contract now adds up to $4.3 million and will come out of the state’s CARES Act funds.

The increased concerns over unemployment fraud is what caused the legislature to pass a bill during this year’s regular session from Sen. Arthur Orr, R-Decatur, that would put into law some existing and new unemployment fraud detection practices at ADOL.

Some of the requirements in the bill include weekly checks of the Alabama Department of Corrections’ rolls to ensure inmates aren’t receiving benefits and using a National Association of State Workforce Agencies platform designed to compare and analyze claims data for enhanced fraud detection and improper payments.

That law will go into effect on Jan. 1.

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