Unemployed Inmates


‘Step right up, folks? Read all about it? Inmates are receiving unemployment benefits while behind bars!’? Could you imagine if that piece of news were true? Oh wait, it may be. An article on WSMV.com begins to get to the bottom of it and asks whether inmates are committing unemployment fraud behind bars—and if so—how they are doing it.

When we think about inmates, we may not expect jail to be a place where crime is committed. We put the criminals in jail for a reason, right? Regardless of our wishful thinking, crime still continues behind bars—though there are efforts underway at federal, state and local levels to try and stop it. (You mean we can’t just put everyone on lock down all the time with no communication?) We can see those efforts now that 944 people, including inmates and their families in the Nashville, Tennessee area, are being investigated for cashing unemployment checks. You might be asking? ”Is cashing a check a crime?’? Um…probably yes—if the person making the claim and cashing the check is not eligible for those benefits. According to a Tennessee state law, any person who is incarcerated for four days in a week’s time is ineligible for unemployment benefits. So where is the exception?

The reality is there isn’t an exception. Rules are the rules. In efforts to continue enforcing those rules appropriately, a new type of tracking machine has landed the 944 possible fraudsters on the map to ”Gotcha-Town.” (Just think, while you are out looking for a job, inmates are potentially cashing in on unemployment while you, the taxpayer, support their incarceration.) The state Department of Labor is looking into several factors, including whether the inmates inside the prisons had outside people use their personal information to register for unemployment benefits. So, what’s the potential cost of this alleged scam? It’s a whopping $1.06 million dollars. The assistant administrator for the state Department of Labor said: ”A million dollars is a lot of money, and if it’s going out the back door, we want to get it back.” (Ever tried getting blood from a stone? Well, getting this money back will be even harder.) Investigations on the possible fraud continue.

It’s amazing how we feel like jail takes away all of the bad guys and leaves the rest of the world good and innocent. Jail has crime just like the outside world, and sometimes it’s worse. If the inmates in this case are found guilty of unemployment fraud, they may be extending their tenure in jail.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Hundreds Investigated for Possible Unemployment Fraud,” written by Jeremy Finley and published by WSMV.com on February 26, 2013.

The Channel 4 I-Team has uncovered that 944 people, including inmates and possibly their families, are being investigated by the state for cashing in on unemployment checks.

A 2012 state law forbids anyone who is incarcerated for four days in a week’s time from getting unemployment.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.