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Audit: TN unemployment payouts plagued by fraud, errors, delays

2:24 PM, Mar 28, 2013   |    comments
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Tennessee's Department of Labor and Workforce Development is under fire after a state audit found millions of dollars over overpayments and errors in unemployment payments.

The Single Audit Report is an annual audit of state agencies and universities to make sure they are complying with federal requirements.  It was conducted by the state comptroller.

The audit found overpayments exceeding $73 million due to fraud and errors over the last six years.  State auditors blamed the errors on ineffective or non-existent controls over the program.  The department is also failing to get the money back when errors are realized, collecting just 23 percent of overpayments.

To make matters worse, the audit found that people who were actually eligible to receive the benefits did not received them in a timely manner.

"The state's unemployed citizens must be able to rely on the Department of Labor and Workforce Development officials to properly administer the unemployment insurance program and provide critical benefits to those who are dependent on them," Comptroller Justin P. Wilson said. "The new acting commissioner of the department has responded and initiated a corrective action plan to strengthen controls and establish program oversight. We appreciate the new commissioner's prompt action as well as the former commissioner's request for a review of specific allegations when she identified fraud risks within the department."

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