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Tenn. Labor commissioner answers to scathing audit: 'We know we need to get better.'

Unemployment McCord interview.JPG
Posted at 8:13 PM, Apr 01, 2022
and last updated 2022-04-01 21:13:46-04

NASHVILLE, Tenn. (WTVF) — As Tennessee rushes to recover the $1.9 million in unemployment benefits that one audit claims they mishandled, labor commissioner Jeff McCord declared that victims of identity theft will not be stuck with the bill.

The audit from earlier in the week detailed what some called systemic issues within the Tennessee Department of Labor & Workforce Development (TDLWD) at the height of the pandemic.

Most problems centered around the same conclusion that the department issued pandemic benefits to claimants who failed ID verification for state benefits.

The audit stated that “claimants who failed to pass the ID verification on a claim could file another claim for pandemic benefits and receive payments without first verifying their identity.”

NewsChannel 5 Investigates asked commissioner McCord why it appeared so easy according to this audit to go around the safety protocols with little to no vetting.

“It would be inaccurate to say there was no check. There are a lot of checks — $4.5 billion distributed and we’re talking about a small percentage of those that are being questioned,” McCord said.

McCord said that while he understands that $1.9 million is still a lot of money, it pales compared to the $4.5 billion distributed between state and federal unemployment programs.

The problem is that for some, even a small amount landing in the wrong hands is too much.

"The criminal activity got really sophisticated during the pandemic. There was a lot of money available across the country, and so all our mechanisms had to continue to get more rigorous. That caused a slowdown, and that's not good for anybody. Certainly not what we wanted to happen," McCord said.

NewsChannel 5 Investigates met one woman who asked us to conceal her identity after already dealing with having someone stealing her identity.

A couple of weeks ago, she received a letter from the TDLWD that instructed her to attend a re-employment services and eligibility assessment workshop if she planned to continue her unemployment benefits.

Had the letter not been sent to her by mistake, she would have never known that someone had applied for unemployment benefits in her name. Depending on when they applied, they may have made more than her without stepping out of their door.

“It makes me mad all over again,” she said as she read the letter.

She received an appeal letter a few days later, triggered by the thief who was hoping to continue unemployment benefits. They scheduled a meeting for this week, so the woman tells us she attended along with an HR representative from the job she’s had since 2008.

When the meeting began, she was told to hold her right hand in the air and swear she was telling the truth.

“I’m on the phone…really,” she said.

“I called them and said why? I have not filed for unemployment. Nor have I been unemployed. They wouldn’t tell me who? Or how long they’ve used my name, my address and my social security number,” she said.

McCord said the process is far more sophisticated. He said they still require two forms of ID, but he couldn’t elaborate on why this was any different.

“Swearing on a bible or whatever the case may be over the phone doesn’t make a lot of sense, and that’s not how the process works or should work,” McCord said.

They told the unidentified woman that it would be another 10-15 days before the state would have a determination on her account.

Then you have people like Lesley Albert who applied for unemployment benefits but learned that thieves had accessed her account.

They used her identity to re-route money into bank accounts she had never heard of. We first met over Zoom while she waited for answers from the state. It would take 15 months from the time she applied to the time she saw her first payment as a result.

“When you have all those things and you have to continually prove that you are you, to me, it tells of a system that’s broken,” Lesley said.

There’s no telling how much these thieves have stolen from both women, but they say the real question remains to be answered. Who will pay this all back?

McCord answered, “If somebody’s identity has been stolen, they’re not going to be responsible for funds going for over payments. That’s for sure.”

He said that while fraud will never cease to exist, one of their biggest concerns has been preparing if foreign entities attempt to gain access to sensitive files.

“We’re working with law enforcement continuously to try and prevent that,” McCord said.

As for where we go from here, we asked McCord what he plans to do about the state’s vendor Geographic Solutions, which some say is at the heart of many of the processing issues.

McCord said while they’re contractually obligated, “we are looking at whatever vendors are out there and how can we improve if those improvements aren’t made.”

McCord went on to say they’re working to modernize their system of cross-checking social security numbers. They’re also working to re-open their job centers so people can verify their identities in person.

“It’s not supposed to happen where someone spends months trying to prove who they are. It’s just not supposed to happen and those are things that we’re in the process of correcting, need to correct and get better,” McCord said.