After nearly a year of dealing with massive fraud, Ohio is launching a multi-agency operation to search for the people who bilked the state out of hundreds of millions of dollars in unemployment claims. Leaders say the probe will likely find scammers within Ohio and around the world.
David DeVillers, former U.S. Attorney for the southern district of Ohio, is heading up the operation by the Ohio Department of Job and Family Services. The probe will include the FBI and other federal agencies to investigate the many fraudulent unemployment claims filed during the pandemic.
DeVillers says this can create "peer-to-peer" communication among agencies to ultimately streamline investigations and speed up the process towards recovering the $465 million doled out to scammers.
"I promise you that there are a lot of good, hardworking people that want to get this done and we will work and do everything we can with law enforcement to make sure that it's done," DeVillers says.
The latest numbers from ODJFS show the state paid out:
- $21 million to fraudulent claims through traditional unemployment
- $444 million to fraudulent claims through the Pandemic Unemployment Assistance (PUA)
- $457 million in non-fraudulent overpayments through traditional unemployment
- $1.7 billion in non-fraudulent overpayments through the Pandemic Unemployment Assistance (PUA)
The Pandemic Unemployment Assistance was a program created by the federal government in 2020 to allow part-time, self-employed, and other workers to collect unemployment who are not typically eligible for the traditional program.
The state-mandated shut down of businesses last spring led to a large volume of unemployment compensation filings, putting a burden on an outdated system. This prompted long lag times and a backlog of claims.
ODJFS has since entered into a private-public partnership to update the system and create more guardrails toward preventing fraud online.
"Our unemployment program is in a much better position now than it was a year ago and we will continue to make it as efficient, reliable, and fraud-proof as possible. And to recover all the funds that we possibly can," says Matt Damschroder, ODJFS interim director.
DeVillers says his team will be able to analyze the data behind possible cases of fraud and put together a package to send back to law enforcement agencies.
The former U.S. attorney says there will be three ways to recover money obtained by fraud; through financial institutions, civil forfeiture, and criminal forfeiture.
The latter could take years to play out, from filing charges to going to court. DeVillers mentions the statute of limitations for these types of cases tends to be five years.
The collaboration with federal agencies can also help coordinate investigations into out-of-state offenders.
"What we're finding is that the most amount of fraud, the most amount of loss and claimants are dealing with both national and international fraudulent individuals and enterprises," says DeVillers. "Make no mistake, there is fraud within and just within the state of Ohio and we are working with state authorities to do that as well."
DeVillers says the Ohio-based fraud will likely increase work for Franklin County Prosecutor Gary Tyack adding that the Ohio Prosecuting Attorneys Association has agreed to provide help when needed.
In regards to the non-fraudulent payments, ODJFS will soon send out notifications to people who received an overpayment. For some this might be a letter in the mail and for others it could be an e-mail.
Damschroder says, from there, people will have the opportunity to fill out a waiver if they received the money because of agency error or employer error.
