The U.S. Department of Labor reported that an estimated $14 billion were overspent in unemployment benefits in fiscal 2011.
The federal government and states like Indiana, one of the worst offenders, are now trying to recoup the lost money and prevent future overpayment.
According to the Census Bureau, the distributed benefits did help 3.2 million Americans in need in 2010. However, there are three types of people who have received overpaid funds: people actively searching for jobs, those who were fired or quit their job, and those who have returned to work but are continuing to claim unemployment.
Overpayment is typically an administrative error made by the government, the employer, or the employee. It can also be a combination of all parties.
Scams also contributed to overpayment with claims involving prison inmates, illegal immigrants, and deceased citizens. During fiscal 2011, there were 2,700 convictions of fraud related to unemployment insurance. Punishment typically consists of probation, community service, or an added penalty to the payback amount.
Ryan Greminger, 39, of Richmond, Indiana admits that he collected unemployment benefits while serving a two-year prison sentence for a drug-related crime. Prior to his conviction, he was laid off from a factory in 2007. He was encouraged to keep filing claims from a fellow inmate.
"It's not like some big scheme I thought of," Greminger said. "I paid this guy $50 each time to have his girlfriend — a woman I had never met — file my unemployment claims."
Greminger explained that he needed the money to provide for his fiancé and their four kids. He is now out of jail and working to repay over $14,000 to the state.
"I accept responsibility for what I did. It was wrong. It was a mistake," he said. "I'm paying for it now."
Vice President Joe Biden is now leading the charge against wasted federal spending through the Campaign to Cut Waste initiative.
The Labor Department predicts that only half of the overpayments can be recovered. Gay Gilbert, an administrator in the Labor Department’s Office of Unemployment Insurances said that only a fourth of the “recoverable” funds have actually been retrieved.
“We believe our improper payment rate has very slightly started to tick down," Gilbert said.
When the federal government discovered overpayment, a letter is sent to the worker instructing them to return the funds. In some states, workers are allowed to prove if they are in financial distress to waive the payments. Otherwise, claimants can be taken to court if they do not pay back what they owe.
Repayments can be processed by being withdrawn from garnishing wags, being deducted from federal income taxes or payment plans.
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This Week’s Celebrity Instagrams (11/26-12/2)
30 photos Launch gallery
1. Little Legend and Puddy 😍😍😍😍
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2. "You on point Phife?" "all the time,Tip". 💥 #bannedfromnormal
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3. Vegan! The Impossible burger at Crossroads
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4. Lawrence #BeforeandAfterEpisodes 1-4: 184lbs 13% body fatEpisode 8: 196lbs 8% body fat S/O @coachdaveboxing with the works outs and @kildareriordan with the nutrition
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5. Jus haaaanngin out
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6. Meanwhile back at home in Atlanta GA someone mad they not on the 🛳. 😳
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7. No limits... Photo cred: Chris Bridges @ludacris
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8. new new
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9. Apparently my 260lbs is too much for the actual vines in the Hawaiian jungles to hold me without breaking and me falling hundreds of feet. So for safety purposes, I'm forced to swing thru #Jumanjj on wires strong enough to hold 12 adult buffaloes and 1 adult Rock. #OnSet #Jumanji #IronicallyIEatBuffaloDailyForLunch #MoreManThanNatureKnowsWhatToDoWith
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10. hey ma! 🎎#wcw 💙
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11. Surprise visit to our factories!!! #GoodAmerican #USA
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13. Peachy Keen 🔥✨⚡️
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14. If this don't look thankful I don't know what does. Happy Thanksgiving to you and yours. #UltraBlessed #24kMagic #SweetPotatoFly
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15. Late nights @nbcmarlon with the writers... we in here!!!
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16. There goes my baaaaaaaaabbbbyyyyy #QueenKingMagic!!! We're up to something! Ira BIG!!! Stay out our buisness -
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17. You want to win every game you play but when you come home to these faces... who cares. #ILoveYouGirls best part of my day, everyday!
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18. Steady,steady..... full size jenga.. "I got this one "???? Or do I ?
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19. Cornrows kind of day 😉@dontaysavoy2 you convinced me and I love. ❤️️
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20. #BrotherlyLove #tbt
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22. #basel #TeamLOVE @kingcombs
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23. Just introduced a special screening of @directher 's groundbreaking (must see) documentary @13thfilm with my brother @themichaelealy | @unitedblackout #blackoutblackfriday
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24. Me & Vanessa Williams giving #DuckLips #Pose on the set of #DaytimeDivas @vh1 - Coming Soon to a tv near you. Lol. - My make up done by @makeupsurgeon
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25. This picture just makes me wanna praise the Lord, you hear me!!!!!! Yes Lord brotha #TEDDYCAMPBELL What a #man !!! You are everything right on this picture husband ......... #gorgeous #stylish #classy #strong #masculine #king #sexy #debonair #gentlemenstyle And that #bible in your hand just seals the deal for me (probably cause i know that, that is what helped you become just as amazing as you look😘). While my heart and mind experiences the goodness of God at #church on Sundays, my eyes experiences the goodness of Teddy😍. Amen somebody🙌🏽. "Bless the Lord oh my soul and all that is within me bless his holy name" #myman #myhusband #goodman #blackman #dapperman #godlyman #goodfather #mybestfriend
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26. Yesterday was my mama's 53rd birthday!!!!! Got to celebrate with her all day. If this is what I have to look forward to I can't wait. Looking like a soft bucket a cocoa butter. Yaaaaaaaaaas! 😍😍😍 love you mommy!
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27. "Shout out to @PureAtlanta for getting the family right"....I'm loving this jogger. 😍😍
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28. This pic warms my heart ❤️ #myLogiebeans and aunt aunt umba @itowandabraxton 😘
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29. You will always be my baby😜. #HappyBirthdayReginae #mybaby18
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30. GC "Gods Child" Red on Red SweatSuit available now at www.MonicaApparel.com ... Take Your Crown wherever you go!! I'm pictured in a Medium... Go to the site now for other options ... cc: @trukernell
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