Unemployment Fraud Legislation Passed By House, Heads To Senate

Feb 3, 2021

The Indiana Government Center building
Credit (Justin Hicks/IPB News)

Legislation to crack down on unemployment benefits fraud passed a House vote yesterday and now heads to the Senate. Even with amendments, some groups say it still has the potential to harm those who make honest mistakes.

The bill would disqualify and penalize people who lie or withhold information in their applications for unemployment benefits. Legislators say it's intended to help the Department of Workforce Development efficiently weed out fraudulent claims. 

"The department has assured us that their review of applications will not change and that they intended to only reduce the amount of fraudulent claims that were truly fraudulent," said Rep. Ryan Hatfield (D-Evansville). "We were trying to strike a balance ... to protect Hoosiers while also cutting down on fraudulent claims."

READ MORE: Lawyers Urge Halt to DWD's 'Aggressive' Attempts To Collect On Unemployment Errors

During debates on the House floor, Hatfield's amendment to only penalize "material" facts – rather than "any" fact, as originally drafted – succeeded. However, other proposed amendments to make DWD undergo an audit and waive overpayments on federal benefit programs failed. 

Jennifer Terry with Indiana Legal Services says, due to technology issues in the pandemic, DWD has occasionally instructed their clients to enter inaccurate information as a work around for benefits they deserved. She's still worried the bill opens up the door for those people – and others who were just confused – to be investigated for fraud, and hopes there will be time for a larger discussion about unemployment benefits in the future.

“When the system requires them to enter a false piece of information, and then we have a law that says you could be subjected to penalties because of that false information, it just kind of shows you the bigger issues,” she said. 

The bill passed a House vote unanimously and was referred to the Senate.

Contact reporter Justin at jhicks@wvpe.org or follow him on Twitter at @Hicks_JustinM.