LOUISVILLE, Ky. (WDRB) -- Kentucky Auditor Mike Harmon’s office released new findings Wednesday on the state’s unemployment insurance program in 2020 and 2021.
Auditors highlighted nine areas of concern over jobless benefits, including alleged fraud by 54 people who said they were state employees when they filed for unemployment and received more than $330,000.
A random sample of 13 of those claims confirmed that none was a state worker.
Auditors also found that more than 28,000 people outside Kentucky received more than $195 million in benefits. They then reviewed 34 of them in detail, discovering that 15 of those were fraudulent but still were paid nearly $70,000.
Harmon said in an interview that it’s not possible to estimate how much might have been paid out improperly to out-of-state claimants, but he noted the “large percentage” in the small sample size.
“You can only envision but can't say specifically, or give you a fair estimate, of specifically how much was paid out fraudulently," he said.
The unemployment system has been strained during the COVID-19 pandemic, with complaints about backlogs, unpaid claims and other problems for Kentuckians dealing with job losses.
And despite some findings that highlight concern about system security and the accuracy of benefits paid, Harmon said the recent report shows some progress.
“Basically what it tells us is we've seen improvement from last year, but we still have a long way to go,” he said.
The report released Wednesday is the first of two volumes of Kentucky’s annual comprehensive financial report. The audit covers the 12-month period ending in June 2021.
The Kentucky Labor Cabinet pushed back on some of the findings. For example, the state audit found that the cabinet’s Office of Unemployment Insurance had not reported cases of suspected or alleged fraud to federal investigators. The cabinet claims it has.
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