News10NBC Investigates: NYS Comptroller conducting forensic audit on NYS Department of Labor

ROCHESTER, N.Y. (WHEC) — For more than a year, News10NBC has been investigating major issues with New York State’s unemployment system.

From it nearly collapsing, to a breach of personal information, to the discovery its operating system is upwards of 40 years old and then of course, how easy it has been for scammers to file false claims, it seems there is always an issue impacting those who rely on it.

The NYS Comptroller now has the department under a microscope too. Tom DiNapoli and his team are currently conducting a forensic audit of the NYS Department of Labor’s unemployment system to see just how badly it failed during the pandemic and why and what is being done to make sure it doesn’t happen again.

News10NBC Investigative Reporter Jennifer Lewke recently spoke with DiNapoli about the ongoing investigation.

Jennifer Lewke – We’ve done at least 40 stories on all the failures of the system, I know your office is investigating as well, what can you tell me about where you’re at with the audit?

Comptroller DiNapoli – Well, the audit is underway and audits always take some period of time so I’m sure we’re months away before we’ll have a report but early on we started getting calls from people getting notifications of unemployment benefits when they had never applied for it so there’s that real question of fraud and people trying to game the system.

Scammers have looted billions from taxpayers and businesses who pay into the state’s unemployment system. The NYS Department of Labor has refused to answer many of News10NBC’s direct questions about how money has gone into the hands of scammers and what they’re doing about it.

Jennifer Lewke – The Department of Labor has told me repeatedly, “we can’t tell you exactly how much fraud there is,” or “we can’t tell you exactly what we’re doing because we don’t want the scammers to capitalize on that.” can they tell you? Do they have to tell you that kind of thing in order to make sure you have a fair look at what happened?

Comptroller DiNapoli – Well, we hope so. One of the challenges frankly with many of the state agencies when we go on an audit is that too often they don’t want to give you the information and then there’s certainly limitations as to what we can work with. But we’re going to look as closely as we can, we’re going to ask the tough questions and so far we’ve gotten a strong sense of cooperation from them and I certainly hope that that will continue. When we go in and we do an IT security audit, there sometimes is confidential information and we have to confidentially share some recommendations with the entity that we’re auditing but I’d like to think in this case in terms of the safeguards we think will be needed… we cannot only recommend them to the agency, the Department of Labor but we can also make them clear publicly.

Jennifer Lewke – Where do you sort of expect this investigation might go?

Comptroller DiNapoli – Well, you know I don’t know… it may not produce any remarkable surprises in terms of something we don’t know already but I think the bottom-line value of the audit will not be so much to point a finger and say this is what went wrong because a lot of this we do know already, the real value will be what can we recommend to make sure it doesn’t happen again.