Improved detection prompts spike in unemployment fraud cases

Cheketa Nicole Causey received 27 weekly checks -- each for $135 -- from July 2011 through February 2012.

She was one of 315,414 Georgians collecting unemployment insurance benefits that fiscal year.

An investigation later found that the 30-year-old Macon woman had already started work in June 2011 with a company that provided at-home care for the elderly. Although she had a job with a paycheck, she continued to pocket several thousand dollars in unemployment benefits, records show.

She wasn’t alone.

Georgia Department of Labor statistics show that 2,882 cases of fraud, representing $7.7 million, were detected in 2012.

By 2014, the number of fraud cases had swelled to 20,644, representing nearly $31 million.

The phenomenon is due largely to improved detection methods, said Sam Hall, a spokesman for the department.

When he took office in 2011, Labor Commissioner Mark Butler took a tough stance on preventing fraud, recovering funds fraudulently taken and prosecuting offenders, Hall said.

In response, employees were instructed to work overtime in 2013, reviewing data associated with claims and cross-matching beneficiaries’ Social Security numbers against employees listed on wage reports that employers file regularly.

Workers also are now comparing unemployment claims against state and national databases listing newly hired employees.

In March, Georgia started using a computerized system that automatically audits claims to detect fraudulent overpayments.

“The improved automation has helped to improve our ability to detect and recover the funds,” Hall said.

Staffers often get tips from the community, both those filed through the department’s website and from folks who call directly.

“Most people are honest and I think most people don’t want to see crimes committed,” Hall said. “When people commit fraud, it is harmful to the trust fund and it’s harmful to the system.”


When fraud is detected, an investigator contacts the alleged perpetrator, who has 15 days to appeal the contention that they’ve received funds they’re not entitled to.

If the case is still valid and no repayment plan has been arranged after 30 days, the department starts the process of recovering its lost funds, Hall said.

After 90 days, if there’s still no payment plan or settlement in process, criminal charges are filed.

Nearly 350 criminal cases were filed in Middle Georgia between fiscal 2010 and fiscal 2014, which ended June 30 this year, according to the department’s statistics.

Of the cases in Middle Georgia, 208 were filed in Bibb County.

Myra Tisdale, an assistant Bibb County district attorney, said money fraudulently taken must total $4,000 or more to be a felony and handled in Superior Court. Her office has handled about a dozen cases in 2013 and 2014.

The bulk of the cases filed in Bibb County involve less than $4,000 and are handed as misdemeanors in State Court.

Although someone could be sentenced to up to five years in prison for a felony and up to a year for a misdemeanor, defendants typically receive probation, a fine and are ordered to pay restitution.

“It’s about getting the unemployment benefits paid back,” Bibb County Solicitor Rebecca Grist said.

In April, Causey was sentenced to five years on probation and ordered to pay a $500 fine, according to Bibb County Superior Court records.

Attempts to reach her for comment last week were unsuccessful.

In an effort to recover its money, the state in recent years has started intercepting state and federal income tax refunds otherwise destined for people who committed fraud, Hall said.

Stopping fraud benefits everyone -- not just employers, the funding source for the state’s unemployment trust fund.

“The more people abuse the system, the more the payments have to be increased for everybody, just like any insurance pool,” said Greg George, an associate professor of economics and director of the Center for Economic Analysis at Middle Georgia State College.

In an economy where businesses can’t always increase prices without pricing themselves out of the market, cash for the extra premiums may come from employee furloughs, pay cuts and reductions in benefits, George said.

“Anybody who’s ever run a business and looked at a budget knows you can only save so much on staples and three-ring binders,” he said.

To contact writer Amy Leigh Womack, call 744-4398.