North Carolina’s unemployment office is under the microscope after two new state audits found the Division of Employment Security improperly paid out $168.8 million in confirmed overpayments between April 1, 2021, and March 31, 2025, including $47.2 million that auditors labeled as fraud. The reviews pegged the improper payment rate at roughly 22% for that stretch and highlighted persistent delays in getting first checks out the door. Only a sliver of the fraudulent money has been clawed back so far, according to the reports.
The findings come from two performance audits delivered to lawmakers this week, according to The News & Observer. The auditor’s office confirmed that $168.8 million in overpayments were established from April 1, 2021, through March 31, 2025, with $47.2 million of that total appearing to be fraudulent. Investigators traced many of the problems to long-running breakdowns in work-search documentation and eligibility checks that started in the pandemic and stuck around afterward.
Local reporting notes that roughly $40 million of the fraud ties back to the early pandemic months when the extra $600 a week in federal benefits was flowing, and that DES has so far recovered only about $12.2 million, according to CBS17. Agency officials told local outlets the hunt for the rest will be a long game, with years of collection efforts, benefit offsets and other tools ahead. Auditors warned that, right now, the money recovered is only a small fraction of what they flagged as improper…