Editorial: Widespread 2020 fraud in Ohio jobless claims highlights need for accountability, reforms


The acting head of Ohio’s unemployment compensation program said Monday that the state had paid out more than $2.1 billion in mistaken or fraudulent benefits during the COVID-19 pandemic.

That eye-popping revelation, by Matthew Damschroder, acting director of the Ohio Department of Job and Family Services, was troubling enough.

But it came on top of recent allegations by Ohio Auditor Keith Faber, in a cleveland.com interview, that ODJFS under prior leadership repeatedly misled his office, from last May to December, about the extent of jobless claim fraud and was slow to institute additional anti-fraud measures.

Faber, whose own identity was stolen for jobless-claim fraud, acknowledged in the interview with Jeremy Pelzer that, at the time, ODJFS was overwhelmed by jobless claims and had prioritized getting checks mailed out. Yet that doesn’t excuse misleading auditors, or being blind to mounting fraud and its costs, both in dollars and trust.

Nor does it take off the hook Gov. Mike DeWine and Lt. Gov. Jon Husted, to whom DeWine had delegated solving the jobless-claims problem, for not stepping in more forcefully to exert leadership and control of a department so obviously spinning out of control.

Or absolve the state legislature for years of funding neglect of ODJFS that clearly set the stage for the department’s COVID-19 meltdown.

What’s needed? Top-down reform. Improved funding. A re-examination of ODJFS’ structure — mixing jobless claims and human services. Upgraded security and computer systems. And far more oversight and accountability for performance.

Three months ago, in contrast to Damschroder’s latest estimates, Kimberly Henderson, then director of Job and Family Services, told reporters that Ohio had paid at least $330 million in fraudulent pandemic unemployment benefits claims between April 2020 and December 2020. Yet Faber told Pelzer his aides had been told during a routine 2020 audit of ODJFS that unemployment compensation fraud involved just “ordinary (audit) scope stuff.”

. . . DeWine and Husted should have recognized from the get-go that Job and Family Services was overwhelmed – obvious to countless unemployed Ohioans – and that the agency needed help. With state and local health departments, ODJFS was the front-line COVID-19 responder, or should have been, for working Ohioans. But there were warning flags from Day One.

… The Ohio legislature has shirked its duty to remedy financial challenges to the state’s unemployment compensation fund — including when Faber was president of the state Senate.

… DeWine and Husted face the big-picture challenge: They must get and keep Job and Family Services up to speed. If the governor and lieutenant governor fail to do so, that would fairly call into question their management skills, a factor voters will consider during 2022′s gubernatorial election.

— Cleveland Plain Dealer, May 23