The entitlement society

District AG to sue former city workers for fraudulent jobless benefits

The District’s attorney general said Wednesday that he will sue former city employees who collected unemployment benefits while working.

Attorney General Irvin B. Nathan said his office will begin filing civil suits “in the next few weeks” to recover the city’s money. District officials have estimated that the cityhad paid as much as $800,000 in jobless benefits to working city employees since 2009.

Mayor Vincent C. Gray’s administration has fired 61 of 92 employees who were suspended in February pending the outcome of a review of city records to determine whether workers had fraudulently collected benefits in the past three years.

More firings are expected, and more workers have fallen under suspicion.

Lisa Mallory, director of Department of Employment Services, said that since February’s suspensions, the agency had discovered improper payments to other current employees. “We found another batch of 100,” she said. Officials have not estimated how much those 100 employees might have collected in improper benefits.

Also implicated are at least 40 workers who left the District's employment before February’s suspensions, officials said.

“Like our Mayor, I take these cases very seriously,” Nathan said in a statement Wednesday. “My office is fully committed to recouping all monies it can from present and former city employees who illegally obtained unemployment compensation while working for the city government.”

The improper payments ranged from a few hundred dollars to more than $20,000 per employee, authorities said.

Pedro Ribeiro, a spokesman for Gray (D), said the administration had turned over the cases to the attorney general’s office to recoup the money. “We’re not going to tolerate this kind of activity in the government,” Ribeiro said.

Workers suspected of receiving improper payments have the opportunity to appeal before the city takes legal action, officials said.

The inspector general’s office, which has negotiated guilty pleas in eight similar investigations since December 2010, has teamed with Nathan’s office to conduct the investigation.

City officials, citing personnel laws, have declined to release the names, job titles or departments of those who allegedly received improper payments. But Nathan has said that many of the workers were employed in the Office of the State Superintendent of Education, and he described them as drivers.

Officials said few employees have escaped termination after being investigated. Three employees avoided termination because investigators found that they were unaware that payments were in error, according to records obtained by The Washington Post. The city also decided to use “alternative discipline” in a few cases: Two employees accepted suspensions; another returned to work after repaying the money.

In those cases, “the amount was significantly low, or it was an oversight,” Ribeiro said.

Employment Services is auditing payments made since 2009. With the funding from the U.S. Department of Labor, the city agency has instituted a more comprehensive verification system that cross-checks city payrolls, a national database of new hires and listings of unemployment recipients.

The Gray administration had a shaky start last year, when it was criticized for high salaries and questionable hires. Gray fired or asked for resignations from several high-profile employees, and his administration now requires all employees to sign an ethics pledge.

Mallory said unemployment compensation was one of the areas that DOES knew needed some house-cleaning. “We are not going to stand for any abuse in any of these programs,” she said.