Gov. MLG’s labor dept. overpaid $250M in benefits due to ‘fraudulent claims and human error’

On Wednesday, it was revealed that embattled Gov. Michelle Lujan Grisham’s New Mexico Department of Workforce Solutions (NMDWS) overpaid $250 million in unemployment benefits during the recent viral outbreak due to “fraudulent claims and human error,” which has left Democrat and Republican lawmakers furious.

A recent report from the Legislative Finance Committee report on the matter, “the reasons for the overpayments included insufficient staffing at the state Department of Workforce Solutions and a backlog of investigations into potentially fraudulent claims.” 

According to the Albuquerque Journal, “New Mexico’s unemployment fund was largely depleted last year by the explosion of pandemic-related jobless claims, prompting the state to borrow $278 million from the federal government to continue paying benefits to unemployed workers.” 

Of the projected $250 million in overpayments, about $133 million were due to potentially fraudulent claims, the report notes.

“The sudden influx of calls and claims hit very quickly,” said acting NMDWS secretary Ricky Serna, who took over the agency’s reins after previous Secretary Bill McCamley stepped down.

Sen. Crystal Diamond (R-Elephant Butte) blamed the Governor and her cabinet for the problems, telling KOB 4, “Ultimately, this falls in the governor’s office, and the executive, and this went on for far too long, and now legislators are being presented with somehow coming up with a solution of fixing a problem that should have never started and certainly should have never grown to the rate it is presented today.” 

Serna acknowledged that it would be very difficult to recoup the millions of dollars expended by the Department, but some overpayments may be able to be recovered due to adjustments with those still receiving benefits (around 90,000 New Mexicans). 

Benefits Attorney Alicia Clark who has heard from around 100 out of work New Mexicans on the issue, “People are getting their benefits garnished before they’ve had a chance to appeal their determination,” said Clark, who estimated she’s heard from more than 100 out-of-work New Mexicans on the issue.

“It’s not the people’s fault they got overpaid – it’s the department’s,” she said.

Gov. Michelle Lujan Grisham line-item vetoed an earmarked $600 million on federal funds to renew the depleted unemployment fund appropriated by the Legislature. According to the Governor’s spokeswoman, Nora Sackett, “at the time that the action was necessary due to uncertainty over the federal guidelines for spending the dollars.”

3 thoughts on “Gov. MLG’s labor dept. overpaid $250M in benefits due to ‘fraudulent claims and human error’”

  1. Considering how long it was taking to receive benefits (90 days average), the department had sufficient time to review all cases. On top of 90 day delays for due process/claims rebuttals, this department failed the People. Now those people get to pay it back, if they can.

  2. They lagged on our claim and never did come thru with the “extra” $$. We are self employed and submitted every single piece of documentation asked for. We were locked out of our account, called DAILY, left many messages with people… Nada. Zip. Zero. They owe us so much back unemployment….. Reckon it would been easier to apply under fake name and fake employer. Cannot even tell you how badly this hurt us financially with 2 small businesses depending solely on tourist trade. Gruesome gives ZERO f@cks. This is their JOB! WTF. SHE IS WORTHLESS.

  3. I reported the fraudulent unemployment claim in my name. Being self employed it was a great surprise to get the notice as the employer that I had filed.

    This was reported back in Aug of 2020 and all they did was “Thank you for the information provided . This claim has been identified and marked as fraud claim due to Identity theft; account has been locked down for your safety and the integrity of the claim .
    -In the future if you need unemployment benefits you will have to provide proof of identity to get the account unlocked.

    My question is, what proof of identity was used to initiate the claim? The integrity of what claim? Is it really a case of identity theft if was only from this office?

    And. How could it take this long for it to surface to the tune of 250M?

    Because somebody walked away with a butt ton of money.

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