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Lawmakers Battle High Unemployment Fraud

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SALEM, Ore. – State officials say unemployment fraud nearly doubled because of the recession. Now lawmakers are considering a bill to deter false reporting.

Since 2007 the amount of money lost to unemployment fraud rose from just over $6.5 million, to over $11.5 million.

Overall, the state is down $55 million. Officials say it’s a numbers game. As more people collect unemployment for longer periods of time, fraud is bound to increase.

“The system gave out well over a billion dollars a year in unemployment insurance benefits during the recession, so this led to more people defrauding the system,” said Employment Department Communications Manager Tom Fuller.

Officials say that $55 million in overpayments cuts into available funds for those who need it. That’s where Senate Bill 191 comes in. While it hasn’t yet come to a vote, it would allow for the penalties on fraudulent payments to double, from 15% of the overpayment amount to 30%.

Fuller says he sees it as a deterrent.

“When people read examples of people being charged that 30% penalty, it hopefully will make them think before they go out and try to commit the fraud,” said Fuller.

But Fuller says an even better deterrent is to create jobs, something that WorkSource Officials are working on here in Medford.

“We’ve seen a lot of new businesses pop up as the recovery continues,” said Shawn Blair, Supervisor at WorkSource’s Medford office. “We’re really touching them and getting them involved with those in the community who are qualified, the skilled workforce who is available.”

While Jackson County has higher unemployment than the rest of the state, the good news is it’s dropping — down from 11.2% this time last year to 9.7% as of April.