Updates to Tracking Down Unemployment Insurance Fraud

October 14, 2014
Updates to Tracking Down Unemployment Insurance Fraud

New updates to the system that regulates California’s unemployment insurance program are helping to protect the state from insurance fraud.

30-year-old Computer System

California’s Employment Development Department (EDD) has long had to deal with breakdowns of the current 30-year-old system.  Staffers have been forced to spend extra time looking for irregularities or suspected fraud manually. Because of this, tens of thousands of legitimate benefit claims – some up to $450 a week – were denied or delayed, as a result, making it difficult, if not impossible, for jobless workers to pay for cost of living. On the flip side, fraudulent claims cost the agency an estimated tens of millions of dollars per year.

Pondera Solutions

Now the agency is hopeful it’s found a cheaper, more accurate way to track down fraudulent claims by teaming up with Sacramento-area company, Pondera Solutions. California will be using a $1.75-million, one-year grant from the U.S. Department of Labor, to label with Pondera Solutions, a partner of Google Inc.

Tracking Down Fraud

The agency is hoping to be able to root out and identify fraud, even before it enters the system. “Our goal is to identify as quickly as possible any potential fraud that’s occurring in the system with no tolerance for false documents,” said Pondera’s chief executive, Jon Coss. “We can knock the bad actors out of the system.”

Starting Jan. 1, California will be the second state in the country to integrate Pondera technology. The program has proven successful in Iowa. “Pondera uses cloud-based Google programs that analyze unemployment insurance claimants, employer tax payments and even street-level photos to signal to government agencies that further investigation is needed,” Coss said.

Patrick W. Henning Jr., Director of the EDD, says the new system “will help us more quickly identify any suspicious patterns.”

Source: The Los Angeles Times, Unemployment insurance program getting help in ferreting out fraud, October 12, 2014

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