An audit into South Carolina’s jobs agency has found it does not do enough to stop fraudulent unemployment benefits.
The state Department of Employment and Workforce (DEW) does not consistently check to see that those receiving jobless benefits are looking for work, according to a new report released Tuesday from the Legislative Audit Council (LAC).
The audit examined a system the agency was supposed to use to cross-match wage information from companies against the list of people who were receiving unemployment benefits. The audit found that from 2005 to 2011 the system did not work properly. DEW officials say they installed a new system in December– the Benefit Audit, Reporting, and Tracking System (BARTS) — that will be able to help cut into the fraud.
The audit also said it found the agency’s standards had grown lax. Under its own policies, DEW was supposed to conduct eligibility reviews every 12 weeks of claimants receiving unemployment benefits. However, LAC found local offices were not scheduling the reviews that often and, when they did, the reviews were not as thorough as required.
“(We) found that, for some ERs, DEW officials simply collected the claimant’s required paperwork and asked a few questions in the office lobby,” the audit said.
Director Abraham Turner told the auditors that he would look into their recommendations. Most of the investigation focused on the months before Turner took over for previous director John Finan in September.
“While the report does offer recommendations for improvements, it also identifies many of the positive initiatives the department has taken in the past two years,” Turner wrote the LAC in response to the report, “These actions have transformed our agency into a more effective, progressive organization with a keen focus on our strategic objective of putting South Carolinians back to work.”
The report did say DEW was on track to repay $850 million in federal loans its predecessor– the Employment Security Commission– was forced to take after its trust fund became insolvent. That ensuing controversy eventually led to the Commission being restructured as the Cabinet-level DEW in 2010. According to the audit, the debt is now down to $780 million and expected to be brought back into balance in 2015.
But the report also focused on problems in the state’s 56 unemployment offices, known as “SC Works” centers. According to the LAC, auditors were unable to reach an employee at 14 of those offices when they called– and six had full voicemail boxes.
The audit also found that DEW’s website did not contain basic information about eligibility requirements and duration of benefits. It also found two SC Works centers that showed claimants an outdated video which included incorrect information.
LAC said DEW took steps to address some of the communications issues after auditors alerted them to the problems.
The report released Tuesday was the second of periodic audits the agency is required to undergo as part of the 2010 restructuring.