Audit: Extensive Problems In LA Labor Agency's Computer System

BATON ROUGE (AP) — Problems with the Louisiana labor department's new computer system caused incorrect unemployment payments, stalled fraud investigations and widespread disruptions throughout the program for jobless residents, according to an audit released Monday.

         The report from Legislative Auditor Daryl Purpera's office says some people were overpaid unemployment benefits, while others received less money than they should have from the Louisiana Workforce Commission during the budget year that ended June 30.

         A test of 62 people who sought unemployment assistance showed 10 were overpaid, three were underpaid and five others continued to receive unemployment checks even though they had gotten jobs, according to Purpera's office. Some errors had yet to be fully corrected at the time of the audit, and the workforce commission hadn't yet sought repayment of some of the money.

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         Former Gov. Bobby Jindal's administration started using the new system on Nov. 9, a rollout that auditors say came even after the system "had not passed all testing necessary to demonstrate consistent functional operations."

         Data from the old system wasn't properly transferred to the new one, which was called the Helping Individuals Reach Employment, or HiRE, system. The new computer system immediately issued incorrect unemployment payments as soon as it went online, auditors said.

         "HiRE could not properly determine eligibility and benefits, process proper payments timely or without manual intervention or produce reliable reports to support financial and federal reporting objectives," the report says.

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         Because of the problems, auditors say about 35,000 possible fraud investigations couldn't be worked as of September. The system had such inadequate security that the report warns that it could lead to "unauthorized view or theft of unemployment insurance and tax data."

         The workforce commission has paid at least $4.2 million in contract costs to the companies involved with the computer system.

         New management was chosen to lead the department when Gov. John Bel Edwards took office in January. Edwards' executive director of the workforce commission, Ava Dejoie, agreed with the audit findings, but said the problems identified during her predecessor's tenure haven't put the state's Unemployment Trust Fund that pays benefits at risk.

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         Work continues to improve the computer system, Dejoie wrote in her response, saying the agency is "committed to completing this process with dispatch, and our progress has and will continue to be substantial."

         She described corrections made to the computer system, notifications to the federal government and daily audits to end the problems. Dejoie wrote that the agency "has a high degree of confidence that current payments made to claimants in HiRE are accurate."

         – by AP Reporter Melinda Deslatte



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