ALBANY - $1.4 million in inappropriate unemployment insurance payments or payment requests by the Department of Labor (DOL), including to recipients that were employed, deceased or unauthorized to work in the United States, according to a report released by State Comptroller Thomas DiNapoli. The Comptroller's Office also found nearly $1 million in improper payments which had already been paid.

"In these challenging fiscal times, state agencies must watch their spending closely," DiNapoli said. "Clearly that isn't happening when payments are sent to deceased people. We've asked the Department of Labor to tighten its controls to stop erroneous payments and make sure unemployment insurance benefits go to the right people."

DiNapoli's auditors examined the DOL payments during 2011. They prevented $1.4 million in current or future payments and identified nearly $1 million in improper, completed payments. During the review, auditors matched DOL files with records of deceased claimants, finding 42 who were paid a total of $11,195. A match against newly-hired New York state workers revealed 91 employees who collectively owed $151,372 to DOL for unemployment overpayments.

All unemployment benefits are subject to Comptroller audit prior to payment. DOL paid a total of $7.6 billion to claimants in 2011.

The Comptroller's findings included completed or planned payments of:

• $206,034 to individuals who were employed, deceased, or out of the country;
• $149,671 to claimants not authorized to work in the United States;
• $154,474 in overpayments that weren't recovered because they were misclassified as non-recoverable or the recoupment wasn't set up.

Auditors also identified $383,304 in erroneous overpayments which DOL did not correct because more than one year had elapsed. The Comptroller recommended that DOL consider changing its one-year policy, which may require legislative action.

In response to the Comptroller's recommendations, DOL agreed to tighten its controls and ensure that staff follows procedures when processing claims.

For a copy of the report visit: www.osc.state.ny.us/audits/allaudits/2011bse3a006ui.pdf