Grove Legislation Would Increase Penalties for Willful Unemployment Compensation Fraud
2/13/2012
HARRISBURG – The House Labor and Industry Committee today unanimously approved legislation authored by Rep. Seth Grove (R-Dover) to institute additional reforms for Pennsylvania’s unemployment compensation system, increasing penalties for willful unemployment compensation fraud.

“People are fed up with individuals who wrongfully take advantage of taxpayer-funded programs,” said Grove. “My legislation will increase the penalty for anyone who files a fraudulent claim and will remove the statute of limitations for penalties related to fraud. Discouraging fraud is a step in the direction of solvency for this public fund.”



Grove’s House Bill 1852 would increase the penalty period for individuals who commit unemployment compensation fraud from two weeks to 10 weeks. It would remove the current four-year limit on the imposition of these penalty weeks.

The legislation was amended in committee to include recommendations from the Pennsylvania Department of Labor and Industry. The amendment would add a 15 percent penalty to the total owed to the fund for a fraudulent claim. The amendment also would create a 52-week penalty for individuals who commit willful fraud to collect benefits while in prison.

Grove’s proposal will save the Unemployment Compensation Trust Fund an estimated $15 million to $20 million annually. The fund is currently billions of dollars in debt to the federal government. A reform package was signed into law in 2011, but Grove believes further restructuring of the system is necessary to return the fund to solvency.

Grove noted that Pennsylvania outpaces other states when it comes to the percentage of fraudulent claims. While the national average is nearly 3 percent, Pennsylvania’s rate of fraudulent claims is more than 5 percent, costing taxpayers $172 million in fraud overpayments.

House Bill 1852 will now go before the full House for consideration.

More information about Grove and his legislative priorities is available at RepGrove.com or Facebook.com/RepSethGrove.

State Representative Seth Grove
196th District, Pennsylvania House of Representatives
Contact: Nicole Wamsley
nwamsley@pahousegop.com
717.783.8063
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