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Nebraska state senators seek answers about potential unemployment fraud
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NEBRASKA LEGISLATURE

Nebraska state senators seek answers about potential unemployment fraud

A new report from the Federal Trade Commission reveals that Americans have lost more than $77 million in coronavirus related fraud. Veuer’s Nick Cardona has that story.

LINCOLN — Two Sarpy County lawmakers are seeking answers about how much Nebraska has paid out in fraudulent unemployment claims since the COVID pandemic hit last year.

State Sens. Carol Blood of Bellevue and Jen Day of Omaha sent a letter to State Labor Commissioner John Albin on Wednesday asking for information about what they called an “apparent wave of fraudulent claims.”

The two said they decided to act after Blood’s office heard from hundreds of people across the state who had encountered problems with the unemployment system and after seeing reports about cybercrime gangs sharing “cheat sheets” about vulnerable states, including Nebraska.

They noted that, with tax time approaching, people have been receiving letters from the Internal Revenue Service and state agencies about benefits they allegedly received but never sought.

“As elected officials who are responsible for the tax dollars of our constituents and all Nebraskans, we first and foremost need to know that the department is doing everything it can to make sure that these types of fraudulent claims are no longer being paid out,” they wrote.

The letter asked for estimates of the total dollar amount paid out on fraudulent claims and for information about what the state is doing to recoup that money. It also asked about steps being taken to prevent future losses.

Nebraska saw a sharp increase in unemployment claims starting in early March 2020 because of pandemic-related shutdowns. Workers filed more than 129,309 new claims over seven weeks — more than the number filed during the whole of the previous three years.

New claims have declined, but remain higher than in the pre-pandemic times.

In December, the State Auditor’s Office issued a management letter estimating that perhaps 66% of all unemployment payments had problems or were in error. A random sampling of cases identified more than $600,000 in questionable payments, suggesting the total amount could be in the millions.


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Martha Stoddard keeps legislators honest from The World-Herald's Lincoln bureau, where she covers news from the State Capitol. Follow her on Twitter @StoddardOWH. Phone: 402-670-2402

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