Unemployment fraud penalties

Posted by: Nov 10, 2014By Brian Stutheit

Despite knowing that it is improper and unlawful, the Colorado Department of Labor’s Unemployment Insurance Integrity
Benefit Payment Control section  continues to send citizens demands for repayment which include a 65% penalty for fraud.  This is outrageous.

It is the Benefit Payment Control people who send out notices of overpayment and demands for repayment of benefits.  These collectors routinely assume that someone fraudulently under reported wages from part time work, or miscalculated earnings.  Often these collectors never even ask the benefit recipient to explain a deviation between what they told Unemployment they were earning from part time work and what actual earnings were.

Once they have assumed fraud, the collectors demand repayment plus a penalty.  They always demand a 65% penalty.  This is what is unlawful.

The penalty for overpayment as a result of willful misrepresentation was amended by House Bill 1124 in 2013. The Bill raised the penalty for fraudulent receipt of benefits from 50% to 65%. The revised penalty was only to be imposed upon improper payments received after August 7, 2013.  However, Colorado has been demanding the 65% penalty against everyone it decides should be penalized, no matter when benefits were received.  They leave it to benefit recipients to learn that they are being assessed unlawfully high benefits.  For a government agency to act so carelessly, or cavalierly, is wrong.  Stutheit & Gartland, P.C. is contacting the press  and the office of Governor Hickenlooper about this. We are exploring a class action lawsuit to return unlawful penalties.

If you get a repayment demand, do not let them assess penalties without a fight.