Kentucky auditor Mike Harmon 4-21-21

Kentucky Auditor Mike Harmon, via Zoom April 21, 2021

LOUISVILLE, Ky. (WDRB) – Kentucky Auditor Mike Harmon has formally notified Attorney General Daniel Cameron’s office of possible criminal activity after Harmon’s staff found “at least” 10 employees of the Kentucky Office of Unemployment Insurance accessed their own unemployment claims last spring when the pandemic took hold.

Harmon’s findings are part of an annual statewide audit undertaken by his office, the second volume of which was released Tuesday.

Harmon’s findings are similar to that of a February investigation by a state inspector general, which found that some unemployment office employees exploited gaps in the system in early 2020 to claim benefits to which they were not entitled.

Those gaps allowed them to get paid state benefits and the $600-per-week federal CARES Act supplement based the alleged loss of parttime jobs, despite maintaining their fulltime employment with the state.

In some cases, the employees overrode “stops” that prevented payments from being released on their accounts, according to the inspector general’s report, which was first publicized last week by the Lexington Herald-Leader.

Harmon said his office was unable to determine whether unemployment office employees actually made changes to their claims. But the fact that they could have warranted the criminal referral, Harmon told WDRB.

“We ourselves could not determine whether they took those stops off, whether they made changes, but they could have. And if they did, in my personal opinion, that would be a form a fraud,” Harmon said. “ … We felt like it rose to such a level it was important for us to do an official referral so that they knew we took this very seriously.”

Harmon said his audit presumably refers to the same employees and the same conduct examined in more depth by the inspector general. The report by inspector general Maryellen Mynear “just confirms what we had already found,” Harmon said.

Harmon’s audit includes no employee names, while the names are redacted in the version of the inspector general’s report made available through an open records request to Gov. Andy Beshear’s office.

Beshear said last week that he and Lt. Gov. Jacqueline Coleman last year ordered Mynear’s report after learning about misconduct by as many as 30 state employees. (Coleman is also secretary of Beshear’s Education and Workforce Development Cabinet, which included the Office of Unemployment Insurance at the time).

Beshear said last week that Mynear’s report led him to take personnel actions including firing some employees, though he did not say how many.

“When we learned that some employees might have been getting on the system themselves to process their own unemployment claims, it was absolutely unacceptable,” Beshear said April 15. “… It was people taking advantage of their position and it’s not OK and it denigrates the hard work of every other UI employee that showed up to do the right thing.”

On Wednesday, a spokeswoman for Beshear's Labor Cabinet -- where the Office of Unemployment Insurance now resides -- said Harmon's report is old news.

"Nearly all the information in the Auditor’s new report has been previously disclosed by the administration, reported on and even resolved," Holly Neal said in email. "A majority of the findings were based on OUI acting on initial information from the federal government that was later reversed. One finding even relates to the unemployment insurance employee investigation that the Governor and Lt. Governor called for and acted upon the results."

Harmon, a Republican who has been rumored as a possible challenger to Beshear, a Democrat, in 2023, said the fact that unemployment employees accessed their own accounts further erodes public trust.

Harmon noted that his office reported in February that state officials never opened about 400,000 emails from Kentuckians desperate to get help with their claims.

“That kind of broke my heart back then, and this only, kind of, adds to that concern,” Harmon said. “…People had the opportunity to review and make changes to their own accounts when others were struggling to get their bills paid and even get a claim.”

Reach reporter Chris Otts at 502-585-0822, cotts@wdrb.com, on Twitter or on Facebook. Copyright 2021 WDRB Media. All rights reserved.