Nearly 90 city employees were suspended Monday and face potential firing and prosecution for receiving unemployment benefits while holding their city jobs, District officials said.
In addition, about 40 former city workers cashed unemployment checks they were not entitled to and also face sanctions. In all, the city estimates it has paid out as much as $800,000 in unemployment benefits to working city employees since 2009.
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“By holding people accountable, that sends a clear message we’re not tolerating this behavior,” said Lisa Mallory, director of the D.C. Department of Employment Services, which administers the jobless benefits program.
Monday’s action, which follows at least three years of scrutiny from local and federal authorities, represents an unusually broad crackdown on corruption in the District government workforce. The volume of benefits claims has soared alongside the District’s jobless rate, and investigators have taken an increasing interest in how the unemployment program guards against fraud.
D.C. Inspector General Charles J. Willoughby and Attorney General Irvin B. Nathan are involved in the investigation, and authorities anticipate referring at least some cases to federal prosecutors for criminal action. Mallory, whose office continues to review cases, also said she has worked with the U.S. Department of Labor to prevent this type of fraud.
Employees accused of wrongdoing worked in various arms of the District government, including the public schools and the D.C. Council staff, according to a high-ranking official to Mayor Vincent C. Gray (D) who was not allowed to speak publicly on the investigation. Some of the employees, Mallory said, received $20,000 or more; others received only a few hundred dollars.
The alleged fraud is not complicated, nor is it uncommon in unemployment insurance programs: Workers apply for checks and receive them legitimately for a time but fail to inform authorities when they go back to work.
“Some are people who come in and out of government and never stopped [receiving unemployment checks]. Some may have worked in parts of an agency where for the summer months you don’t work,” Mallory said. “There are no clear patterns that we can discern. It’s just a matter of certifying you aren’t receiving income when you are receiving income.”
A Gray spokesman declined to release workers’ names Monday, citing privacy restrictions.
Mallory said her department regularly passes cases of suspected “overpayments” fraud to the inspector general for investigation and potential prosecution, but Monday’s crackdown represents an unprecedented review of the city’s 33,000-strong government workforce.
“Our focus is really on trying to deter,” she said. “We want to make sure that individuals who owe this money are actually held accountable for these overpayments.”
Nathan said in a statement that the alleged fraud is “unconscionable for anyone — and particularly District of Columbia employees, who should have high ethical standards.”
Jeff Lagda, a spokesman for the Labor Department’s inspector general, cited department policy Monday in not confirming or denying any ongoing investigation.
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