Thousands illegally pocket unemployment benefits annually

KANSAS CITY, Mo. - Picture the Internal Revenue Service. Images of accountants with calculators fiercely adding up your tax dollars may come to mind.

But in December, the U.S. Attorney’s Office indicted ten former IRS workers for illegally pocketing your money. In all, they are accused of collecting $112,604 in unemployment benefits while still working inside the IRS. Federal court records show the workers carried out the scheme between 2008 and 2013. 

Call for Action tried to track down and speak to those former IRS employees. Many have since moved. 

"I told her that (expletive) going to catch up with ya, and sure enough," said a man who identified himself as the husband of Leisa Hunsel. 

Hunsel is accused of pocketing $8,151 in state and federal tax dollars.   

"I believe it was some who felt they could get away with... One tried it so they all tried it," he said.  

They are part of a much bigger problem. Thousands of people each year are caught abusing the system and collecting unemployment while holding down jobs.

Some collect while sitting behind bars. Since 2012, 760 people have been caught collecting unemployment while incarcerated in Missouri. Overall, 5,785 people in Missouri illegally pocketed $6.9 million in unemployment benefits so far in 2014.

Over the past five years, 50,099 people illegally collected funds in Missouri. In Kansas, 20,860 people were caught during the same five year period.

"There are a lot of criminals out there who think of different ways to use benefit programs," Lana Gordon, the head of the Kansas Department of Labor, said.   

Gordon’s agency cracks down on those who collect illegally, which hurts hurt a compensation fund set up to help those honest taxpayers out of a job.

"Being a law enforcement agency now gives us the opportunity to be able to enforce the law to its fullest extent," Gordon said.  

New Kansas legislation passed in 2013 increases the agency's investigative muscle and penalties for anyone caught abusing the system. A person caught now will not be able to collect unemployment for five years. The penalty phase used to be only one year.

From 2009-2013, the Kansas Department of Labor reported recovering $17. 5 million. The Missouri Department of Labor reported recovering $56.4 million during the same period. 

Some states like Missouri work with the federal Treasury Offset Program which collects overpayments from a criminal's income tax return. 

Six of the ten IRS workers we mentioned pleaded guilty to theft. They must pay thousands in restitution and serve time on probation.

You can report fraud to the Kansas Department of Labor directly online: http://www.dol.ks.gov/UI/fraud.aspx . In Missouri, you can report onlin e or call 573-751-1099. 

Print this article Back to Top

Comments