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Maryland labor secretary tells committee pandemic-era identity fraud drove large overpayment backlog; department resuming collections
Summary
At a Feb. 4 Economic Matters Committee briefing, Secretary Wu said Maryland paused overpayment collections during the pandemic, has reissued many determinations and mailed roughly 180,000 notices; the department has recovered hundreds of millions from frozen debit-card accounts but acknowledged some amounts are not collectible because of identity theft.
Secretary Wu told the Economic Matters Committee on Feb. 4 that pandemic-era identity theft and administrative pauses left a backlog of unemployment insurance overpayments that the department has begun to address.
Wu said the department stopped consistently collecting overpayments in 2020 and did not resume regular collection activity until 2023. "We turned that back on in 2023 going forward," she said, adding that many determinations from the pandemic period required reissuance to include legally mandated appeal rights.
Why it matters: The department must recover overpayments under federal law within a three-year window to be collectible, Wu said, and long pauses and litigation left a window of payments that cannot now be recovered. That gap contributed…
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