On Point Technology Cites Threat Of Organized Multi-State Unemployment Insurance Fraud To State Trust Funds in April 25th Testimony Before US House Ways & Means Subcommittee on Human Resources

CHICAGO, May 7, 2012 /PRNewswire/ -- "Organized multi-state unemployment insurance fraud poses a major threat to the integrity and solvency of state UI trust funds," testified Mike Cullen, managing director of On Point Technology, in his April 25th testimony before the US House Ways & Means Subcommittee on Human Resources Hearing: Moving from Unemployment Checks to Paychecks: Implementing Recent Reforms. "Organized fraud exists and states that are armed with integrity software to combat organized fraud can avoid significant losses to their trust funds," opined Cullen, an industry leader in unemployment insurance fraud detection, prevention and recovery who called for increased cooperation, participation and resource-sharing at the local, state and federal level, integrity software upgrades and increased administrative funding levels to lower the current 12% Improper UI Payment Rate, currently estimated at $13.7 billion in 2011 alone, according to US DOL figures.

Cullen predicted that heavy state borrowing from the Federal Unemployment Account (FUA) will exceed $68.3 billion in FY2013 with 40 states expected to borrow. Additionally, employers struggling to keep their businesses afloat are increasingly bearing the burden of rebuilding the trust funds through repetitive tax increases, with 35 states sustaining hefty UI tax increases in 2011.  

The April 25th Hearing marked Cullen's his third appearance on Capitol Hill in three years representing the private sector on the subject of integrity solutions and technology for Unemployment Insurance. Mr. Cullen previously testified before the Senate Finance Committee on June 22, 2011 and May 25, 2010.

Cullen's recommendations included:

• Automating the prevention, detection and recovery of Improper UI Payments;
• Mandatory state utilization of the National Directory of New Hires (NDNH) cross-matching program;
• Incentivize state UI programs to improve employer participation in filing timely, accurate reports to the Quarterly Benefit / Wage cross-match program;
• Focus efforts by US Dept. of Labor (DOL) and the Office of Inspector General (OIG) to address organized, multi-state fraud;
• Dedication of 10% of federal funding for state integrity program activities with 5% of recovered payments earmarked to support such activities;
• Utilization of all data in the Office of Management and Budget's "Do Not Pay" list to support such activities.    

Chaired by Congressman Geoff Davis (R-KY), the 112th Congress' first hearing on implementation of the reforms to the unemployment insurance system contained in Public Law 112-96, The Middle Class Tax Relief and Job Creation Act of 2012 included additional testimony from government officials and industry leaders including:

• Ms. Jane Oates, M.Ed., Assistant Secretary for Employment and Training, United States Department of Labor, Washington, DC;
• Mr. Douglas J. Holmes, President UWC - Strategic Services on Unemployment and Workers' Compensation, Washington, DC;
• Mr. Darrell L. Gates, UI Committee Chair, Deputy Commissioner, State of New Hampshire;
• Mr. Larry Temple, Executive Director, Texas Workforce Commission.  

Link to Mike Cullen Testimony:
http://waysandmeans.house.gov/UploadedFiles/Michael_Cullen_testimony.pdf

Information about the hearing can be found at:
http://waysandmeans.house.gov/Calendar/EventSingle.aspx?EventID=290890

Founded in 1996, On Point Technology is the nation's largest supplier of integrity software to state workforce agencies for the identification, recovery and repayment of unemployment insurance overpayments. For over 15 years, On Point technology's solutions have enabled 17 states to fund and collect improperly paid UI benefits, returning an estimated $2 billion to state trust funds and the US Treasury. Prior to joining On Point Technology, Cullen was UI Program Director of the Colorado Department of Labor & Employment for six years.

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SOURCE On Point Technology