Colorado Scrambles to Recoup $305 Million in Excess Jobless Claims

Thursday, 13 Oct 2011 04:07 PM

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Colorado is working to recover the whopping $305 million in improper payments it made from the state's Unemployment Insurance Trust Fund — primarily to unemployment claimants — from 2008 through 2010.

The state noticed the problem in May, and the U.S. Department of Labor notified the state in late August that its improper payments reached 17 percent to 18 percent, said Ellen Golombek, executive director of the Colorado Department of Labor and Employment. Four percent of that was because of fraud, the Denver Post quotes Golombek as saying.

The $305 million is out of $2.3 billion paid in benefits, she said.

Cher Haavind, a spokeswoman for the Colorado department, told the Post that Colorado is one of six states that the Labor Department is working with to reduce improper payments.

The state has recovered 43 percent of the $305 million and is working to recoup the rest, Golombek said. If the claimants are no longer receiving benefits, they must repay improper payments in full, she said. If the claimants who received improper payments are continuing to receive benefits, money is taken from the benefit. Other methods of recovery include garnisheeing tax returns and gaming winnings.

On Wednesday, Gov. John Hickenlooper ordered the state’s Labor and Employment Department to reduce improper payments to below the "acceptable federal benchmark of 10 percent” and directed the federal Labor Department to provide a strategic plan, including immediate management system improvements and other actions.

Golombek said the department is increasing the number of staff members handling unemployment claims and improving their training.


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