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Detecting and recovering benefit overpayments

The Minnesota UI Program uses various methods to detect benefit overpayments, including a computer cross match to compare quarterly wages reported by employers with unemployment benefit payments made to applicants. Unemployment Insurance Specialists verify return-to-work dates and wages reported by applicants, investigate employers’ raised issues to benefit charges, and follow up on tips from the public. If payment of any court fees is required in an attempt to enforce collection of overpaid unemployment benefits, penalties, or interest, these fees may be added to the total amount due.

Collection efforts used to recover debt caused by fraud include:

  • Offset of state income and property tax refunds
  • Offset of federal income tax refunds
  • Garnishment of wages
  • Intervention in workers’ compensation cases
  • Intervention in bankruptcy proceedings
  • Liens filed on property
  • Referral to the Minnesota Department of Revenue - Collections Division
  • Court-ordered restitution

In addition to the amount found overpaid, a finding of fraud results in the following:

  • A penalty equal to 40 percent of the benefit amount fraudulently obtained.
  • Interest charged on any unpaid balance of 1.0 percent per month.
  • Ineligibility for unemployment benefits until the week after the overpaid amount is paid in full, including penalties and interest.

In addition to penalties, the UI Program may take the following actions:

  • Assess an administrative penalty making applicants ineligible for unemployment benefits for 13 to 104 weeks.
  • Pursue criminal prosecution under federal and state law.

Report fraud or benefit violations using the online Fraud Report.

Refer to Minnesota Law, §268.18 Subd.2 and §268.182 subd.2, for more details.

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