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Unemployment fraud


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While I have no idea how much unemployment fraud actually occurs, it is rather easy in many states to get away with it. They just ask you where you applied and that's it. You are given a warning that lying on the form is punishable to x extent by the law. I don't know what percentage of these are actually checked.

 

Drivers licenses have numbers and barcodes. Why not have a computerized system that's harder to defraud? Instead of asking where they applied, have their drivers license(or state ID) linked into the system such that it can be scanned upon application? Many applications already ask for the number for background check purposes. This would be easy to implement as most places of employment have scanners, a computer, and/or online applications.

 

Businesses and employees are assigned numbers for the system.

 

Online applications could ask for the number(many already do) and put the number into the system. The number assigned to the business is then added to the person's file in the new unemployment system.

 

Upon finishing an application in-store or delivering a finished application to the store, a drivers license or state ID could be scanned or the number entered manually. The number assigned to the employer and the employee are then added to the person's file in the unemployment system. For stores that somehow have no internet access, there could be a paper form to be filled out with the application that is then mailed to the unemployment agency with the name and signature of the employee and the applicant.

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This makes so much sense that it makes me think there is a reason why we don't do it. It doesn't have to be a good reason, I've found.

 

DMV here in Colorado should be checking to make sure motorists are insured to state minimum levels. They could withhold license plates for those who don't have an active policy, but they don't. All you have to do is sign a form that says you have the proper insurance. Every uninsured motorist who causes an accident signed that paper to get their plates, lied in writing on a government form.

 

The reason they don't do this simple checking? They make more revenue from people who lie but pay to get their plates than from those who couldn't get their plates due to lack of insurance. Both get fined when they cause an accident, but the first guy at least paid for his plates.

 

So maybe the unemployment thing is like that. Someone making enough money so the system won't be changed.

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Unemployment benefits are, or at least had been, determined by your last employer, who can contest the request. If uncontested the recipient will generally be given a green light. Some fraud can be stopped simply by verifying former employers, but rarely done. As for those states requiring, looking for work, none I'm aware of would deny benefits for any excuse, for not accepting a job or would they have cause to verify the attempt.

 

 

When you become unemployed, it's important to file an unemployment claim as quickly as possible. In many cases you will be able to file a claim online and file for weekly benefits online, as well. It's also important to know what to do if your unemployment claim is contested by your employer or denied.[/Quote]

 

http://jobsearch.about.com/od/unemployment/tp/unemployment-compensation.htm

 

Since Unemployment is generally controlled by the State, there are different policies in place and if interested, here are those requirements;

 

http://jobsearch.about.com/od/unemployment/a/unemploymentoff.htm

 

Actual fraud, if you want to question legitimacy, would probably fall under repeating claims, those that might work the States requirement to collect, collect the limit, then getting another job, over and over again. One of my pet peeves, as an employer were those that quit a job, file and receive benefits, even though it's been contested. For the record my day's are before 1995 and I'm not up to date on any of the States I was involved with...

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In Israel the unemployment bureau gives you options for employment (so they act as your "agent"). If you find something else, that's fine, but if you don't, you get offers from employers through the bureau, so they can see who offered and how many jobs you said no to.

 

You can refuse a job offer, but you can't refuse too many times. I believe it's up to three times consequtively; if you refuse a fourth, you lose eligibility. If you get into a job and get fired, you apply to unemployment again.

 

It's a bit more organized, though I can assure you - people DO manage to fraud their way through it. I think whoever WANTS to commit fraud, will find a way.

 

Also, Israel is a social democracy, which means the government (and govt agencies) are a bit more involved in the citizens' rights, I'm not entirely sure this will work in the USA.

 

~mooey

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While I have no idea how much unemployment fraud actually occurs, it is rather easy in many states to get away with it. They just ask you where you applied and that's it. You are given a warning that lying on the form is punishable to x extent by the law. I don't know what percentage of these are actually checked.

 

Drivers licenses have numbers and barcodes. Why not have a computerized system that's harder to defraud? Instead of asking where they applied, have their drivers license(or state ID) linked into the system such that it can be scanned upon application? Many applications already ask for the number for background check purposes. This would be easy to implement as most places of employment have scanners, a computer, and/or online applications.

 

Businesses and employees are assigned numbers for the system.

 

Online applications could ask for the number(many already do) and put the number into the system. The number assigned to the business is then added to the person's file in the new unemployment system.

 

Upon finishing an application in-store or delivering a finished application to the store, a drivers license or state ID could be scanned or the number entered manually. The number assigned to the employer and the employee are then added to the person's file in the unemployment system. For stores that somehow have no internet access, there could be a paper form to be filled out with the application that is then mailed to the unemployment agency with the name and signature of the employee and the applicant.

 

The long and the short of it is that these loopholes are seen as benefits of the system to a great many people. You would be seen as attacking the "everyday" citizen if you imposed such an "invasive" fraud protection system (although to be honest, the idea of having all of your applications traceable in a gov't d-base isn't exactly appealing). With much of the unemployment system you'll find a great deal of equivocating and downright lying going on by seemingly upright people. The fraudulent atmosphere is pervasive throughout, and is the standard rather than the exception. This is the way it's worked for some time, and even though it is broken, the notion of fixing it would most certainly be met with hostility.

 

Beyond the political ramifications, you'll also be looking at creating a new, digital system. This means rules, regulations, new forms, privacy protection, etc.. In addition to the system to handle the incoming information you'll also need to create a standard method of acquiring this information. This means a new set of rules and ensuring the means for all the businesses out there to be able to collect it. If the government isn't supplying these means, then it's just another burden on the business world. Sure the big players can handle it, but this would need to be implemented by every mom&pop operation as well.

Edited by Saryctos
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An interesting point about unemployment fraud and fighting it is the question "Is it worth it?"

 

The majority of people are rather honest and won't claim if not entitled, those who defraud the system are a tiny minority. It is quite possible that nations spend more to combat fraud than the extra fraud would cost them if there were no checks.

 

Consider this possibility (with numbers pulled totally out of the air)

 

A State pays $10 million a year in benefits with all the checks in place and a wages bill for the department of $50 million per year to keep the paperwork straight, a total of $60 million per year. Now we change the system to "If you're entitled come on in. Give us your social security number and if you haven't had a cheque in the last 2 weeks we'll print you one on the spot."

 

Let's say that due to the lack of checks, payments double to $20 million per year. But we have massively reduced the staffing in the offices and wages now only cost $10 million per year. The total cost, even with doubled payments is $30 million, only half what the State was paying before.

 

Think of all the people in the average unemployment office. What exactly is their purpose? To ensure that only those entitled to a payment get one and that those payments are in accordance with the guidelines. Those are the sole reasons for the existence of their jobs. By doing away with the checks and general paper shuffling, staffing gets reduced from between 12 and 20 people to 4, three counter people and an office manager. Note that the rules are much simpler and therefore require no "interpretation" at all, there are no forms to fill out and clients get processed much faster.

 

Now the USA is a big nation and there might be $100 million of fraud if the rules were relaxed, but how much are you spending to prevent that $100 million in fraud? $10 Billion? $20 Billion? It's a question worth asking.

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