Scathing audit details $73M overpaid in unemployment funds

Scathing audit details $73M overpaid in unemployment funds (Image 1)

State leaders are just starting to grasp the magnitude of a scathing audit detailing $73 million dollars overpaid in unemployment benefits.

“73 million dollars is a lot of money, and one audit in the last six years may not be enough,” Rutherford County Representative Joe Carr told Nashville's News 2.

The state comptroller's office released the audit on Thursday and it is like few others in state history with its criticism and findings.

It began with bold type on page 23 proclaiming “management has threatened the integrity of the unemployment insurance program.”

Hundred of thousands of Tennesseans depend on those jobless benefits as they look for work, but the audit found more than “73 million dollars in overpayments due to fraud during the past six years and overpayments due to error for the past three years.”

The audit's harsh findings said the Labor Department had “backlogs… in unemployment calls, processing claims, resolving claims and notifying employers of claims.”

Three top officials at the department resigned last week without mention of the audit.

They were Commissioner Karla Davis, Deputy Commissioner Alisa Malone and the Assistant Commissioner overseeing the unemployment program Turner Nashe.

The department's finance executive Burns Phillips is serving as acting commissioner.

Representative Carr, who is considering a run for Congress, lauded auditors with the state comptroller for detailing the problems, but asked if they should they be checking departments like labor more often.

“Are there a lack of resources in the comptrollers department to do it more often than that? Do we need to shorten that time frame? Maybe that's where we as a legislative body begin?” he questioned.

The audit recommended the present labor department management consult with governor for recommendations.

As for the audit findings, the governor's office said in a statement:

“This administration is committed to efficient and effective service to the Tennessee taxpayer. The department self-reported these issues and, as the release noted, is currently working to correct them.”

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