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NC jobless aid office addressing millions of dollars in overpayments

RALEIGH (AP) — North Carolina has overpaid tens of millions of dollars in jobless benefits since the COVID-19 pandemic to people who don’t actually qualify for them or who have committed fraud, the state’s unemployment program director told legislators on Tuesday.

Pryor Gibson, who leads the Division of Employment Security, described how nearly $70 million had been overpaid during the first nine months of 2020. Nearly all of that total was distributed since the virus lockdowns sent claims rocketing to historic levels.

The overpayments remain a small percentage of the $8 billion in federal and state unemployment benefits distributed in North Carolina during all of 2020. That compares to $160 million in benefits paid overall in 2019, when the state unemployment rate fell below 4%. In 2019, the division reported nearly $7 million in overpayments.

Overpayments can happen due to fraud or unintentional mistakes that lead a person to receive benefits they aren’t entitled to, Gibson said. About two-thirds of the overpayments during the first nine months of 2020 originated from a new federal pandemic benefits program that gave $600 in weekly benefits to claimants, according to a presentation for the Joint Legislative Oversight Committee on Unemployment Insurance.

The division reported that $9 million in benefits since March 31 have been paid out due to identity theft, in which a person uses someone else’s name and information to apply for benefits. Gibson said his agency is acting on several fronts to recover these overpayments, but catching those who commit ID theft is challenging.

Well over $20 million in overpayments had been recovered by the division during the first nine months of 2020, although some of that money was initially distributed in previous years.

North Carolina’s unemployment rate, which soared to almost 13% last spring, was 6.2% in December, the state Commerce Department announced on Tuesday, The rate has been unchanged since October.

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