The Maryland Department of Labor secured 11 civil judgments last month in unemployment insurance fraud cases. Insurance fraud is on the rise across the nation as states are swamped with a record number of applicants with the jobless rate continuing to climb. Other states are also facing such problems. For instance, Ohio unemployment rate reached 10.5% last week and in some places people are filing unemployment through fraudulent means.
In Maryland, DLLR has a system for detecting and prosecuting unemployment insurance fraud. Cases of suspected fraud are brought before Maryland District Court by the department’s benefit payment control unit, according to DLLR.
Defendants face maximum penalties of 90 days incarceration, fines up to $1,000 or both. Those found guilty are also obligated to repay the illegally obtained benefits.
States are struggling to balance their budgets due to high unemployment rates and unemployment compensation claims are going up every day.
Earlier this week, Gov. Martin O’Malley announced that he is pushing legislation that would revamp the state’s strained unemployment insurance system, changing the way jobless benefits are calculated and doled out to a record number of Marylanders.
The governor says the changes are required to collect $126.8 million in federal stimulus money to replenish the state’s dwindling unemployment insurance trust fund. But opponents of the changes, which will be discussed at an Oct. 22 hearing in Annapolis, say O’Malley’s plans would further increase unemployment taxes on companies and nonprofits.
Also, it should be noted that Maryland’s unemployment insurance tax will more than triple for Maryland businesses come Jan. 1, 2010 according to the Department of Labor, Licensing and Regulation.
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