‘It is disheartening’: MDES reacts to audit of $118M improper, fraudulent unemployment claims

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Published: Jun. 23, 2021 at 3:24 PM CDT
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JACKSON, Miss. (WLBT) - Mississippi Department of Employment Security is responding to a state audit that found the agency put $118 million in improper and fraudulent claims into the hands of Mississippians.

While MDES Executive Director Jackie Turner said she respects and admires the auditor’s work, she said perspective is needed to get the entire picture.

While overpayment was 5%, Turner said 95% was proper and within federal guidelines.

“I mean that $118 million is a big number, and we don’t want any overpayment, but if state a state falls under 10%, you are considered to be within the standard of Department of Labor Office of Inspector General,” Turner said.

Fraudulent payments are forwarded to the inspector general for investigation, but Turner says MDES tracks down and collects improper payments.

“Correspondence goes to the applicant, they may set up a payment agreement, we can garnish the wages of claimants if they don’t agree to pay back, we can intercept their federal or state, or both income taxes,” she added. “And that goes back into the trust fund as well.”

Auditors also found several internal controls were suspended or bypassed during the pandemic, which MDES said wasn’t exactly true. For example, Turner said controls for the department’s Social Security Administration crossmatch were not suspended.

“When their [SSA] system was stretched and we couldn’t get an answer back on our crossmatch with them in a reasonable amount of time, we chose to go forward because the cry at that time was to help people so we talked about the risks and we chose to move forward because, at that time, it felt like a greater risk not to help our fellow Mississippians.”

Of the 5% unemployment overpayments, MDES says they’re trying to decipher how much of those payments are improper, and how much is fraudulent.

And Turner claims the agency realizes it must make changes to thwart any more fraudulent claims.

“It has not been a perfect response,” Turner confessed. “There have been hiccups along the way. We have had many issues that had to be worked out over time. We’ve divided and conquered this thing, and at the very beginning, when we said, okay, we’ve got a monumental task ahead of us; we can’t do things the same old way,” she added.

MDES didn’t get into specifics of what internal changes they’re making, but overall, Turner felt the report did give the full picture.

“It is disheartening to see a report come out like this, and know and feel good about what we’ve done here at MDES to push money into the economy. You know, our revenue projections for the state of Mississippi are good. And we think we’ve played a big role in that.”

MDES said they helped to push $4 billion into the state’s economy from March to December of 2020 and assist families who truly needed it.

“We put money into the hands of Mississippians. Did some Mississippians or fraudsters get the money that shouldn’t have? Yes, but that risk in our minds is low compared to the good that was put out.”

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