State employees received $6.7 million in unemployment benefits in error

Nearly 300 state employees erroneously received unemployment benefits totaling $6.7 million and averaging $23,700 per employee during the last two pandemic years, the Georgia Office of Inspector General (OIG) reported Wednesday.

In a letter to David Dove, Gov. Brian Kemp’s executive counsel, Inspector General Mike McAfee wrote that data obtained from the U.S. Department of Labor and the State Accounting Office (SAO) tentatively identified more than 280 full-time state employees who erroneously received unemployment insurance payments in 2020 and 2021.

The OIG has conducted about two dozen interviews with employees from across state government, nearly all of whom have been terminated, McAfee wrote.

“As Governor Kemp’s administration is acutely aware, the nearly $6 trillion in emergency spending authorized by the federal government to combat the COVID-19 pandemic created new challenges in oversight and accountability,” the inspector general wrote.

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“An unfortunate side effect was ‘one of the largest frauds in American history, with billions of dollars stolen by thousands of people,’ ” the letter continued, quoting from articles The New York Times and Washington Post published last year.

“Offices of inspectors general and other investigative agencies across the country continue to struggle with the sheer volume of incoming referrals. Unfortunately, this office can confirm that Georgia’s state workforce was not immune.”

The difficulties the Georgia Department of Labor faced processing a deluge of applications for unemployment benefits at the height of the pandemic have been well documented. State lawmakers were inundated with complaints from constituents over a lack of response from the labor department and subsequent delays in receiving benefits.

In 2021, the General Assembly passed legislation to create the position of chief labor officer inside the labor department who would report directly to the governor. However, Kemp vetoed the bill because the powers it would have given the new position would have put it in conflict with the constitutional authority of Georgia’s elected commissioner of labor.

While the OIG has referred cases of erroneous unemployment payments to the state Attorney General’s office for prosecution, the agency conceded it doesn’t have the resources to investigate every case.

To cope with such a large potential caseload, the letter recommends the General Assembly consider legislation extending the statute of limitations for prosecuting pandemic-related fraud and granting the OIG subpoena authority.

The inspector general also suggested the Georgia Department of Labor and SAO coordinate quarterly to make sure state employees have not submitted inaccurate or false applications for unemployment benefits.

This story is available through a news partnership with Capitol Beat News Service, a project of the Georgia Press Educational Foundation.