Unemployment Insurance Fraud Detection in Iowa

Posted by Gary Bateman, CIO, Iowa Workforce Development

Editor's note: Today’s guest blogger is Gary Bateman, CIO for the Iowa Workforce Development. Be sure to join Innovation for the Nation, a virtual summit featuring government customers, streaming live on July 31st and August 1st. And see what other organizations that have gone Google have to say.

In Iowa, our mission at Iowa Workforce Development (IWD) is to provide a comprehensive statewide system of employment services, education and regulations to ensure the economic security of Iowa’s workers, businesses and communities. An important part of our effort is to identify and prevent unemployment insurance fraud. Our efforts have cut the rate of fraud to less than 6%, but we are not satisfied to stop there.

Detecting and preventing unemployment insurance fraud is challenging because of the high volume of claims we receive. Often times, we’re not able to detect the discrepancy until after multiple payments have been made. This lag means the bad actors can take the money and move on, making it difficult and expensive to recover the payment. We went looking for technologies to provide an even better rate of fraud detection, allowing us to act faster to prevent this criminal activity and save the state money.

After a competitive bid process, we selected Fraud Detection as a Service (FDaaS) by Pondera Solutions, a Google Enterprise Partner, to help us identify and prevent improper payments. FDaaS is a Google-powered solution that uses Google Prediction API, Google Maps, Google Street View and Google Earth.

With FDaaS, suspicious claims are proactively flagged by the system, which alerts IWD employees about potentially fraudulent claims. The claims are plotted on a heatmap built on Google Maps to identify areas with the highest fraud incidents and determine where to put more investigative resources. We also use Google Street View to check the validity of businesses that submit claims. All of these data points are compiled into a custom, configured dashboard that helps us quickly examine claimants and employers to validate whether these claims are valid. This dashboard will replace many of our manual processes of checking disparate databases. And because Google helps to integrate relevant market data into our validation processes, we can parse massive amounts of data quickly and efficiently, allowing us to identify advanced schemes and rapidly respond to potential issues. With all this information available at our fingertips, we can then examine claimants and employers to validate whether these claims are proper much more efficiently.

Using the new solution, IWD will improve accuracies in Unemployment Insurance, benefiting both the employers and citizens of Iowa. Our continuing efforts will help assure that the vast majority of unemployment insurance benefits are delivered to the citizens who need and deserve our assistance.