Improper Payments and Fraud Surge During the Pandemic
The U.S. Government defines improper payments as those “…made by the government to the wrong person, in the wrong amount, or for the wrong reason. Although not all improper payments are fraud, and not all improper payments represent a loss to the government, all improper payments degrade the integrity of government programs and compromise citizens’ trust in government.”Dahl also said in his statement that major challenges for DOL and states include administration and oversight of the UI program with controls to identify fraud, self-certification for pandemic UI benefits, communication with employers, benefit-year earnings, information technology systems, staffing, and monitoring.
While any endeavor to reduce improper payments and fraud on a government program includes a comprehensive approach across people, process, and technology, solid management of data at the state level is imperative to achieve any amount of reduction.
As an example, simply cross-checking Social Security numbers with prison inmate records would have saved California from having to identify and investigate a fraud scheme across their penitentiary system that resulted in an estimated $1 billion in improper pandemic unemployment benefits being paid to inmates and their associates. Other states such as Louisiana, Michigan, Illinois, Kansas, and more are dealing with a surge in claims across the various avenues for UI, and thus payments for individuals are duplicative.
This is a data issue. Inaccurate citizen data, coding errors, and a lack of a single source of truth are at the core of the problem.
Counter Fraud With Data-Centric Solutions
State-level agencies responsible for ensuring UI payments get to the right person, in the right amount, and for the right reason have solutions within their reach now. Trusted data is paramount, and every state can safeguard their programs with an enterprise data management platform that provides capability for the following:- Data must be of the highest quality. Citizen and business names,postal addresses, and social security/tax ID information must be standardized, cleansed, enriched, and validated.
- Data must be secure. Personal identifiable information, or PII, is prevalent in systems of record, and the privacy of this data must be protected from bad actors in a time of crisis.
- Data must be timely and accessible. Before a decision is made on a payment, staff must be able to make real-time decisions on recipient eligibility, which requires access to data and insights captured and maintained across myriad on-premises and multi-cloud environments.
- Data must be mastered. Only with an authoritative single source of truth for your most critical data, also known as having a 360-degree view of entities, people, and their relationships, can agencies ensure payment accuracy and prevent fraud.
- Data must be governed. The standing up of the federal-level Pandemic Response Accountability Committee (PRAC) is a great start in ensuring oversight exists and that funds are accounted for during the crisis. But government agencies—especially at the state-level—in turn will need to ensure data policies are in place with full transparency and accountabilities defined to ensure compliance.
