Labor Dept. Investigation Leads to $40K in Restitution -

Labor Dept. Investigation Leads to $40K in Restitution

Press Release

Jefferson City, Mo- Investigations conducted by the Missouri Labor Department have resulted in 10 individuals pleading guilty to fraudulently receiving Unemployment Insurance (UI) benefits from the state. The individuals were charged with stealing by deceit and have been ordered to pay more than $40,953 in restitution. In addition, 17 individuals have been referred to the local prosecuting attorneys in 6 counties and cities throughout the state (Clay, Barry, Jackson, Mississippi, St. Charles, and St. Louis City).

"Unemployment Insurance was created to give unemployed Missourians some income to pay for the things they need until they get back on their feet," says Department Director Larry Rebman. "We have no tolerance for individuals who attempt to cheat the system. Those that do will be caught by our investigators and ordered to pay the money back. So far this year, we have caught 249 individuals and prosecuted to the fullest extent."

Routine audits recently revealed an additional 10 ineligible individuals received UI benefits. 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 $1,736 to $6,500. Last year, the Department collected a total of more than $1 million in restitution from 179 individuals whose cases have been disposed in previous years.

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 will continue to work with local prosecuting attorneys to convict and charge individuals who fail to follow the law by fraudulently collecting UI benefits. For the month of January, the Department referred 17 individuals to the local prosecuting attorneys in Butler, Greene, Jackson, Jefferson, Mississippi, and St. Louis counties, as well as St. Louis City, where they face class C felony charges.

The Department is looking at ways to increase its ability to further reduce fraud. This year, the Department will be proposing legislation that would deny future benefits to those who have an outstanding penalty that was assessed for a previous overpayment of UI benefits. Currently, Missouri law allows those found guilty of fraud to collect UI benefits despite having outstanding penalties. Over the past few years, these penalties have totaled more than $15 million.

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