Benefits Behind Bars: Mass. Investigating Unemployment Paid to Inmates

The state froze benefits for around 1,700 people who applied for Pandemic Unemployment Assistance during a period while they were apparently incarcerated, according to a spokesperson

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When Corey Griffith was laid off from his parks and recreation job in November 2020, he immediately filed for unemployment.

“So then I wait,” he recalled, standing inside the garage of his home in Marlborough, Massachusetts.

Three months later, Griffith told the NBC10 Investigators he was still waiting to be approved, a frustrating experience shared by scores of laid off workers in Massachusetts, who have faced lengthy delays from the state unemployment system.

Officials at the Department of Unemployment Assistance say those delays spring in part from a new, more rigorous identity verification process, which was put in place last year amid a surge in fraudulent claims.

Amid high unemployment numbers in Massachusetts, some viewers have reached out to NBC10 Boston after having trouble getting their benefits.

Like many others, Griffith got a letter saying his unemployment claim was delayed because he failed to present proper identification – perplexing because the seasonal worker had received unemployment in previous years, and figured the state already had all his information.

“It just didn’t make any sense to me,” he said.

So Griffith was even more baffled when we told him some people behind bars in Massachusetts had an easier time getting approved for unemployment benefits, even though they were locked up.

“That should pop up as a red flag they’re incarcerated,” he said.

But hundreds of inmates in Massachusetts – or people using their identities – may have pulled it off.

The NBC10 Investigators have learned the Department of Unemployment Assistance placed holds on unemployment benefits for around 1,700 people who applied for Pandemic Unemployment Assistance during a period while they were apparently incarcerated.

It sent fact-finding letters to an additional 700 people seeking traditional unemployment pay whose names showed up on state or federal jail lists. Those who were locked up will need to pay the money back with potential penalties and interest.

In other cases, DUA received fraudulent claims filed under the name of an inmate without his or her knowledge. The system continues to be hammered by fraudulent claims as part of a national unemployment scam.

“We should be doing better, but unfortunately, we’ve got a perfect storm here,” said cyber crime expert Steve Weisman.

We asked Rosalin Acosta, Massachusetts' secretary of labor and workforce development, many of the questions you've been asking us about unemployment amid the coronavirus pandemic, including why it's taking so long, what kinds of mistakes commonly hold up claims and what to do if your claim is delayed.

Nationwide, the Pandemic Unemployment Assistance program enacted by Congress last year to help struggling workers provided a lucrative target, Weisman said. Combine that with an unprecedented surge of legitimate claims from laid off workers and state agencies were overwhelmed last year, he said.

“We’re paying out billions and billions of dollars to scammers,” he said.

The state received close to 1 million claims for benefits between April 2020 and January 2021 under the federal government’s expanded pandemic unemployment assistance program. It denied more than half, screening out millions worth of fraudulent claims.

DUA got an additional 1.2 million unemployment claims through its online system, and denied about 262,000, according to information released at the end of February.

Between the two programs, state officials report they've stopped $19.2 billion worth of fraudulent unemployment claims.

But many more were approved. As of last month, the state has paid out at least $687 million in benefits that were later deemed fraudulent or suspicious. It later recovered at least $252 million.

“DUA is also working with state and federal law enforcement agencies, municipalities, and dedicated constituent service personnel to address the national unemployment fraud scheme and recover fraudulent payments,” reads a statement released last month.

The problem has cropped up elsewhere, too.

Noticed a fraudulent transaction on your bank account? Here’s what you should do next. 

In Pennsylvania, federal prosecutors say 10,000 state prisoners fraudulently applied for unemployment. And in California, a scam using inmates’ names bilked the state out of hundreds of millions of dollars.

In New Hampshire, the deputy commissioner of employment security told us the state stopped five claims for unemployment from prisoners over the last year. They say New Hampshire has a strong system to catch those claims, but a technology upgrade let a handful slip through.

In Rhode Island, officials told us they can’t discuss the subject due to investigations underway there now.

Responding to questions from NBC10, unemployment officials in Massachusetts said they cross reference claims with rosters of inmates in Massachusetts state prisons and county jails. If there’s a match, a freeze is placed on the account.

However, under regulations set by the Department of Labor, the state can’t automatically deny the claim based solely on the matching computer records. Instead, claimants get a letter, then have 14 days to respond with more information.

If it turns out a recipient was behind bars the same week they received a payment, they must pay back the money with penalties and interest. Depending on the length and amount of fraudulent activity, the state can also refer the case for criminal prosecution.

“The investigation into unemployment fraud is ongoing and the Department of Unemployment Assistance will continue to monitor the claims activity of those who are or have been incarcerated to determine eligibility,” a spokesperson for the labor department wrote in an email.

In Barnstable, Sheriff James Cummings said word of a successful scam spreads fast inside the county jail. Cummings said he shares a monthly roster of his inmates with the state, and says it’s important to send a message that taxpayer money is being watched closely.

“We want to make sure the people who earned it and are eligible for it, receive it,” he said.

For privacy reasons, the state wouldn’t confirm whether the inmate in Worcester County that we got the tip about received benefits while he was incarcerated.

But the issue is on the radar of Massachusetts Attorney Maura Healey. A spokesperson said the office is concerned about this problem, and wants to hear from anyone with information about unemployment fraud by an inmate.

Griffith, the worker from Marlborough, finally started receiving benefit payments from the state after we got involved. Because his girlfriend kept her job, Griffith said he feels like the couple fared better than many others facing a job loss.

He hopes the state speeds up its process to approve legitimate claims in the future.

“I can’t imagine the people that have to pay their rent, feed their kids, stay warm,” he said. “What are those people doing?”

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