Iowa unemployment agency issues extra checks; tries to keep it quiet

8/22/2014

AP file photo

WAIT JUST A MINUTE: Iowa state Sen. Janet Petersen, D-Des Moines, is taking issue with the state issuing unemployment checks to people who may not have been eligible.

By Paul Brennan | Iowa Watchdog

DES MOINES, Iowa — Iowa Workforce Development may have trouble managing money, but at least its management understands the importance of politeness.

In early March, the agency, which oversees unemployment claims in the state, issued unemployment benefits to 85 people who didn’t ask for them.

According to a March 13 email sent by Regional Operations Manager David Eklund, the plan to recover the improperly issued benefits was simple: Don’t contact any of the lucky 85, just wait to see if anyone voluntarily returns the money.

“We can gladly accept their offer to return the benefits, with a ‘thank you,’” Eklund wrote.

Iowa Watchdog tried to learn how many people returned the unexpected windfall in exchange for a polite “thank you,” but multiple phone calls to Iowa Workforce Development went unreturned.

IWD spokeswoman Kerry Koones did tell the Associated Press the benefits were issued because a computer malfunction prevented the agency’s weekly update of unemployment benefits recipients.

image courtesy of Iowa Workforce Development

EXTRA BENEFITS: In March Iowa Workforce Development paid unemployment benefits to 85 people who didn’t request the benefits. The agency had no plan to recover those benefits, but did take steps to make sure no one outside it would find out about the error.

According to Koones, IWD Director Teresa Wahlert decided to issue benefits for the week ending March 8 based on the previous week’s list of qualified recipients, rather than risk delaying the benefits.

Koones said the extra benefits probably amounted to less $27,000, but she was unable to give an exact figure.

“I understand the importance of making sure people who are unemployed get their benefits, but we also need to make sure our system is working right and is forthcoming about any issues it might have,” State Sen. Janet Petersen, D-Des Moines, told Iowa Watchdog.

Petersen, who chairs the Iowa State Senate Government Oversight Committee, received Eklund’s email as part of an open records request.

“I had heard from people within state government that there had been a failure of the system,” Petersen said.

That is exactly what IWD didn’t want to happen, according to Eklund’s email.

“You are to refrain” from discussing the computer problem and issuing of extra benefits, Eklund informed IWD workers.

“The decision (to issue the benefits) was made at the highest level of this organization and it has been made extremely clear to me, that we are not to question the decision. Again I caution you not to discuss this with other staff.”

Eklund also was clear about keeping the paper trail regarding the decision as short as possible.

“I want no response to this email. DO NOT UNDER ANY CIRCUMSTANCES forward this email to anyone or there will be repercussions. Any comment should be made via the telephone or in person to me.”

Particularly troubling to Petersen is the instruction in the email for IWD fraud investigators to ignore all benefits paid during the week ending March 8 because of the computer error.

“Iowa businesses pay into the program and expect it to be run with integrity,” Petersen said. “For the fraud investigator to receive a directive that can call their credibility into question is way over the line.”

Petersen has scheduled Wednesday an oversight committee hearing on the extra benefits and IWD’s response to the problem.

“We have a lot of questions we need answered,” Petersen said.

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