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FOR PRESS INQUIRIES, CONTACT:  Amy Susan (573) 751-1518
FOR IMMEDIATE RELEASE:  January 25, 2011

Labor Dept. Investigations Leads to $1.1M in Restitution
Collections in 2010 from Individuals Charged with Fraudulently Receiving Unemployment Insurance Benefits

Jefferson City, Mo- Investigations by the Missouri Labor Department have resulted in 145 individuals pleading guilty to fraudulently receiving Unemployment Insurance (UI) benefits from the state in 2010. The individuals were charged with stealing by deceit and have been ordered to pay more than $620,015 in restitution and more than $1.1 million has been recovered this year from previous overpayments as a result of the Department’s investigations.

“During a time when unemployed Missourians need it most, our Department will protect the integrity of the unemployment program by aggressively pursuing those violating the law and receiving benefits that do not belong to them. Employers provide this safety net for those who lose their job due to no fault of their own, not for those looking to swindle extra cash while working another job,” says Department Director Larry Rebman.

Routine audits recently revealed 145 ineligible individuals received UI benefits in 2010. These individuals provided false information on weekly applications for UI benefits which caused benefits to be paid improperly. This type of fraud generally constitutes a class C felony, which carries a sentence of up to seven years imprisonment or, if the sentence is suspended, can result in placement on probation for up to five years and an order to make restitution. The individual restitution amounts in these cases range from $881.37 - $11,696.66.

In 2010, the Department referred 283 cases to the local prosecuting attorneys for criminal prosecution, a 7.2% increase in referrals from 2009. Approximately 65% of the cases referred for prosecution generate from the St. Louis Metropolitan area.

When the Division of Employment Security (DES) determines a claimant has been overpaid or fraudulently received benefits, benefit charges leveled against the claimant's employer(s) are credited back. For reimbursable employers, the employer receives a credit which can be applied to its next billing or refunded upon request.

The Department is looking at ways to increase its ability to further reduce fraud, including denying future benefits to those who commit fraud and giving DES more tools to use in collecting money from those who commit fraud. Currently, Missouri law allows those found guilty of fraud to collect UI benefits despite having outstanding penalties. Since 2005, penalties for fraud overpayments have totaled more than $24,000,000.

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