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N.M. Workforce Agency to Crack Down on Fraud, Improve Service

New Mexico Gov. Michelle Lujan Grisham has announced several upcoming changes to the Department of Workforce Solutions to improve technology capabilities in handling unemployment insurance claims and reducing fraud.

From the creation of a fraud specialist team to a partnership with outside IT experts, the changes announced this month by New Mexico Gov. Michelle Lujan Grisham are pointed squarely at reducing fraud and improving operations within the state’s Department of Workforce Solutions.

Unemployment benefit systems across the country have been stressed by the influx of demand during the COVID-19 pandemic, and New Mexico was no exception. While DWS did launch a single sign-on system in 2019 to make services more easily accessible, a newly announced set of changes will further improve the systems and its security.

For example, the state has established a Fraud Specialist Team to help the agency improve fraud defense through improved detection.

This team will use the expertise of specialists from multiple agencies, including the Human Services Department, the Taxation and Revenue Department and the Department of Information Technology.

Lujan Grisham’s release states that the agency estimates $113 million in overpaid benefits, and a Legislative Finance Committee (LFC) report published in May 2021 cites LFC staff estimates that the state has spent $250 million in benefit overpayments since the beginning of the pandemic. While the state has distributed almost $4 billion in relief over this period, the overpayments were significant enough for the department to take action to reduce fraud risk.

“Fraud is an ongoing issue at labor agencies across the country, and during the pandemic we have seen an increase in identity thieves seeking to take advantage of state systems,” said Acting Workforce Solutions Secretary Ricky Serna in the press release.

Another major change for the agency is the relationship with Abba Technologies, a New Mexico IT solutions firm the state has contracted to analyze the department’s technology systems.

The analysis will help DWS and Abba Technologies implement a framework for tackling agency priorities: unemployment insurance, employment services, fraud mitigation and risk. According to the release, the analysis is projected to take between three and six months to complete.

RiskSense, a cybersecurity firm based in Albuquerque, will be working in conjunction with Abba Technologies. The company will lead the effort to develop a plan to restructure and strengthen DWS. The goal is to improve weaknesses that were identified in the LFC report.

The LFC report made several recommendations for DWS to reduce fraud risk and overpayments, one of which was to hire additional contract staff. The release states that an additional 110 workers will be added to the Unemployment Insurance Operations Center — roughly a 300 percent increase for the center’s staffing — in an attempt to ensure 100 percent of callers receive responses.

The release states that roughly 6,000 unique calls were made each day during the three weeks preceding the June 11 announcement, and the additional staffing is expected to increase capacity to answer 7,000 per day.
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