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State suspects fraud in some unemployment claims as backlog continues

New York State has distributed more than $9.2 billion in unemployment dollars to 2 million New Yorkers, Secretary to the Governor Melissa DeRosa said Monday.

But, she acknowledged, the state Labor Department is still struggling with an overwhelming backlog of at least three weeks.

“I know many New Yorkers have been waiting weeks for their benefits," state Labor Commissioner Roberta Reardon said in a conference call with reporters.

DeRosa said most of the people who are still waiting for their funds after three weeks either haven’t completed their certifications or provided incomplete information.

But there are also cases where the state suspects fraud. Labor specialists are reaching out to those people to complete their processes, but “that’s the exception to the rule.”

“People are angry here, people are angry everywhere right now, with good reason,” Gov. Andrew M. Cuomo acknowledged during a stop in Buffalo on Monday.

“We think people are defrauding the unemployment system," Cuomo continued. "We think there may be widespread computer cyberfraud, where these people don’t even exist, where the fraud is being done on the computer. And you’re giving out billions of dollars in this country.”

Reardon said her department has approved for payment on 1.2 million applications for unemployment benefits that were submitted between March 2 and April 2.

During that same month-long period:

  • 50,000 people who filed claims were deemed ineligible for traditional unemployment and told how to apply for Pandemic Unemployment Insurance, the federally funded program.
  • 16,000 claims advanced to the final processing stage, and will be paid soon or the agency will seek additional information from the applicants.
  • 23,000 applications are stuck without being processed because they are missing critical information, such as a Social Security number or an applicant's name, or they may be a duplicate claim.

Watchdog Team editor Mike McAndrew contributed to this report. 

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