September 1, 2014

State hires more people to investigate unemployment fraud

IWD director,Teresa Wahlert.

IWD director,Teresa Wahlert. (file photo)

State officials are hiring more staff to review unemployment claims and look for fraud.

Iowa Workforce Development director Teresa Wahlert says in 2010 five of the nine investigators in the investigative unit took early retirement incentives and left the agency.

“So we went down to four investigators,” Wahlert says.

The department operated at that barebones staff level for the past three-and-a-half years. However, in May, Wahlert started hiring more investigators for the bureau and by February she plans to have 11 investigators on staff. Wahlert says she’s not worried some fraudulent claims have gone unnoticed during the past few years when the investigative unit was understaffed because Iowa reviews cases longer than the federal government requires.

“I’m not concerned about that because we investigate our cases for over 10 years,” Wahlert says. “So even though the federal law really cuts things off at three years, we in Iowa do go the extra step, so we will continue to be investigating fraud cases for at least 10 years in arrears, as we do overpayments.”

The increase in fraud investigators comes as the number of unemployment claims submitted to Iowa Workforce Development has dropped, due to the improving economy.

In 2013 the agency reported that about six percent of unemployment claims filed in Iowa had some sort of mistake or contained intentional fraud. Iowa Workforce Development recently signed a contract with a company that uses its computer software to flag suspected fraud. For example, sham companies are being set up around the country, claiming to have hired workers, then claiming layoffs — just to collect the unemployment checks. Federal officials estimate about 30 percent of unemployment fraud comes from people who were out of work, but continue to receive unemployment benefits after they’ve landed another job.

First debate in third go-round between Loebsack & Miller-Meeks

The major party candidates running in Iowa’s second congressional district this year met in their first debate of the season Thursday evening. Both Democratic Congressman Dave Loebsack and Republican challenger Mariannette Miller-Meeks agreed congress is dysfunctional.

Miller-Meeks said Loebsack is part of the problem because he moves in “lock-step” with President Obama.

“He is a puppet of this administration and a puppet of Nancy Pelosi, so he does what they want him to do,” Miller-Meeks said. “His voting record shows that.”

Loebsack said he’s worked with Republicans on key issues.

“This year I’m the person who led the charge in the U.S. House of Representatives on a bipartisan basis to get the funding back in for Meals on Wheels,” Loebsack said.

Both said economic sanctions are the appropriate response to Russia’s aggression in Ukraine and the two discussed the rise of Islamic militants who’ve taken control of parts of Syria and Iraq. Miller-Meeks faulted President Obama for pulling U.S. troops out of Iraq in December of 2011.

“In World War II when we had troops that remained in Germany, we had troops that remained in Japan, that we were able to help those countries transition to a more stable form of government, to a growing economy and out of war,” Miller-Meeks said.

Loebsack said the country was “war-weary” when Obama made the call.

“Iraq is not World War II,” Loebsack said. “Iraq is not even North and South Korea and if you’re suggesting that we keep 39,000 troops in Iraq as we did in Korea for all those years or hundreds of thousands of troops as we did in Europe, that makes absolutely no sense.”

On domestic issues, Miller-Meeks said congress must address the growing number of states allowing marijuana to be used as medicine.

“I think you do have to look at decriminalizing the medical use of marijuana,” Miller-Meeks said. “I do think that’s something on a federal level, when you have states acting in that regard, and then that’s in contrast to what the federal law is.”

Loebsack chimed in on the issue as well.

“My answer’s very short,” he said. “I’m in favor of medical marijuana use.”

However, neither embraced the idea of going the next step and making marijuana a legal drug for everyone, just like alcohol.

Miller-Meeks said the Affordable Care Act has not made insurance more affordable, but she did not call for repealing the bill. Loebsack accused Miller-Meeks of flip-flopping from her positions on the issue in previous campaigns. Miller-Meeks has twice before run against Loebsack, losing in 2008 and 2010.

Thursday’s debate was held at City High in Iowa City and broadcast live on Iowa Public Television. The video of the hour-long event is now available on IPTV’s website.

DOT getting closer to decision on traffic cameras

The Iowa Department of Transportation is in the final phase of determining if traffic cameras in six cities meet the requirements of new state rules that began in February. DOT director of traffic and safety Steve Gent says they have finished the review of the reports required of the cities and they still have some questions.

There’s an issue with the speed cameras in I-380 in Cedar Rapids. “At this point we really just need to gather more information. There appears to possibly be an issue in Cedar Rapids that we need to be dealing with and that came about by looking at their review,” Gent says. “That’s probably the one that’s the biggest concern right at the moment.” He says they want more information on whether the speed cameras on I-380 are located within 1,000 feet of a lower speed limit.

Gent says they also had an issue with the Sioux City report. “Sioux City did not provide us before crash data. Anytime you are looking at a safety enhancement, you always look at the crashes before the enhancement was put into place and then crashes afterward,” Gent says. “And of course that was required by the rule and I am not sure why they didn’t submit that. We need more information.”

Other questions involved the before and after crash data for two cameras in Davenport, questions about crashes and violations for each intersection in Muscatine, and concerns raised about the number of red-light violations for an intersection in Des Moines.

Gent says the rules are designed to be sure the cameras are used on state controlled roadways to enhance safety. and that’s what they are trying to determine in the review. “These traffic cameras are okay as long as they are absolutely — and people have to believe that — they are for safety. If people believe that they are a money-making scheme, then that’s a terrible situation. That’s not about what our government is supposed to do,” Gent says.

He hopes to wrap up the issue before the end of the year to determine if all the cameras are in compliance. “The emails were sent out last week for more information and we asked for that information back within a month,” Gent says. “Certainly by the end of the year we will have all of these resolved. When we have issues, we are going to sit down with the cities and make sure we understand all the issues and that they understand all the issues, and we will work together on coming to a resolution.”

Other cities had cameras on state roads, but decided to make changes. Clive decided to shut down its cameras in June. Windsor Heights and Fort Dodge decided to only place their speed cameras on local roadways, which are not covered by DOT rules.


State audit finds cost of confidential settlements more than reported

A state audit released Thursday shows taxpayers paid nearly $700,000 to cover confidential settlements to former state employees over a four-year period. The dollar figure is roughly $200,000 more than what had been previously reported.

On March 24, Governor Branstad signed an executive order ending the use of confidentiality provisions. At the time, his administration identified 24 former state employees who given settlements totaling  $468,000.

State Auditor Mary Mosiman has identified 18 more. “We identified at total of 37 who had confidentiality clauses and of ones that were settled through court proceedings, we had five, so a total of 42 confidentiality clauses,” Mosiman said.

The audit did not reveal any more evidence of so-called “hush money” payments to former state workers in exchange for their silence. Governor Branstad fired Mike Carroll, who was head of the Iowa Department of Administrative Services, after a Des Moines Register investigation found his office had paid nearly $300,000 in settlements to a half dozen former workers to keep the details of their firings secret.

Mosiman noted in her report that the 42 confidentiality clauses did not violate public records laws. “None of them violated (section 22.13 of) the Iowa Code, which states these clauses are a matter of public record,” Mosiman said. “It seems the (confidentiality clauses) were intended to impact the behavior of the parties to the agreements, but it did not impact the ability of the public to have access to the document as a public record.”


Jack Hatch, the Democrat who is challenging Governor Branstad’s re-election bid, released the following statement:

“It’s exhausting trying to get answers out of this Governor. Iowa needs a fresh start with a government built on openness, honesty and transparency after these years of Terry Branstad dodging the truth and hiding the facts. Terry Branstad promised Iowans he would get the facts out, level with Iowans and open up the books.  None of it was true. He still hasn’t kept his promise. Branstad hasn’t been open, he isn’t being honest, and his administration shows no signs of being accountable. Branstad made a change in the leadership at the Department of  Administrative Services and pronounced everything okay. That clearly was not the case as the new Director did not reveal the information about the additional secret settlements. This Governor continues to mismanage state government and act as if he’s above the law, and re-electing him will only reward that behavior. Iowa can do better, and when I’m Governor, we will.”


Statement from Senator Janet Petersen, Democrat, Oversight Committee chair:       

“When the story broke earlier this year about former state employees being offered and paid hush money to keep quiet, few of us could imagine what else was going wrong in the Branstad Administration. Today’s report by the State Auditor is another wake-up call for Iowans concerned about secret settlements, hush money and misuse of our tax dollars.  We need a long-term solution — not Band-Aids — to fix this serious problem in the management of state government. While Governor Branstad and many legislative Republicans show no concern about all these problems, the Senate Oversight Committee is continuing to ask questions that Iowa taxpayers deserve to have answered. We remain disappointed that Governor Branstad and legislative Republicans turned their backs during the 2014 session on Senate File 2358. The report today by the State Auditor demonstrates the need for the Legislature and Governor to get behind legislation, which was designed to keep state government open, honest and accountable to taxpayers by:

- Banning secret settlements and hush money payments throughout state government.

- Expanding protections for those who blow the whistle on wrongful activity.

-  Requiring the State Auditor to investigate previous secret settlements.

- Preventing no-bid contracts on state jobs.

-Outlawing cronyism in hiring state employees.

-Mandating disclosure of state worker bonuses.

-Reforming use of the state “do-not-hire” database.

IWD director defends her managment of state agency, says she’s ‘direct’

Iowa Workforce Development director Teresa Wahlert appeared before the Iowa Senate Oversight Committee Wednesday and defended the way she runs the agency.

“My management style is direct,” Wahlert said.

On Tuesday, administrative law judges in the agency told legislators Wahlert has pressured them to rule in favor of businesses rather than employees in contested unemployment cases. Wahlert told lawmakers the statistics show employees win those cases more often and the rate of employee wins has been increasing.

“To think that I have been influencing people to rule on behalf of employers — the data just does not support that,” Wahlert said.

On Tuesday, several workers in the agency appeared before the senate committee to say Wahlert’s primary management tool was fear. Wahlert on Wednesday told lawmakers she had to make changes to save money and make the agency run more efficiently — and she’s aware her management style isn’t popular with everyone in the department.

“I know that some personalities adapt to change more quickly and readily than others,” she said.

Wahlert and Democrats on the committee quarreled about the agency’s March overpayment of unemployment benefits to 85 people who didn’t seek another round of benefits. Democrats blasted Wahlert for telling employees in the agency not to talk about the computer glitch, and questioned whether the overpayment might be larger. Wahlert responded: “We knew exactly how many people reported it in to us. I have no reason to think it’s more.”

Wahlert said it’s just a cost of doing business and the state will not seek repayment of the 27-thousand dollars worth of unemployment benefits sent to those 85 Iowans since the mistake was the state’s and the employees aren’t at fault.

Steve King predicts ‘politically nuclear’ reaction if Obama issues executive order on immigration

Republican Congressman Steve King says the reaction will be “politically nuclear” if President Obama bypasses congress and issues an executive order granting some sort of legal status to illegal immigrants.

“First, the president has no constitutional authority to make up laws as he wishes they would be, but he threatens to do so anyway,” King told KLEM radio in Le Mars. “…If the president does this and five to nine or more million people get a ‘you are now legal’ slip from the president of the United States, that throws us into an instantaneous constitutional crisis.”

Congress faces another deadline in September to approve a federal budget or pass a stop-gap measure to avoid a government shutdown. King said those discussions may break down if President Obama uses an executive order on immigration policy.

“This would be the most blatantly unconstitutional act by any president of the United States ever if he does what his trial balloons and his own threats have promised to do,” King said. “And so, as the intensity of that gets closer and closer, it’s more and more likely that something like that will happen.”

Reports indicate President Obama is considering executive action that would make more undocumented immigrants eligible for green cards and place more people on the “deferred action” list, so deportation procedings are delayed. White House spokesman Josh Earnest says it “would be a shame” if Republicans in congress decide to shut down the government over the immigration issue.

(Reporting by Dennis Morrice, KLEM, Le Mars; additional reporting by Radio Iowa’s O. Kay Henderson)



Ex-State Senator admits he took $73,000 ‘under the table’ to work on 2012 presidential campaign

Kent Sorenson (file photo)

Kent Sorenson (file photo)

A state senator who resigned after being accused of taking payments to work on a 2012 presidential campaign has pleaded guilty to taking $73,000 worth of what prosecutors call “under-the-table” money.

The U.S. Department of Justice today announced 42-year-old Kent Sorenson of Milo has pled guilty to one count of obstruction of justice and one count of causing a presidential campaign to falsely report its expenditures to the Federal Election Commission.

Sorenson had been the chairman of Michele Bachmann’s campaign for the Iowa Caucuses, but Sorenson now admits he started secret negotiations in the fall of 2011 to switch to the Ron Paul camp, in exchange for money. Prosecutors say some of the $73,000 paid to Sorenson was concealed by transferring the money to a film production company and then to a second company before it got to Sorenson.

In his plea agreement, Sorenson admits he lied to a lawyer hired by the Iowa Senate Ethics Committee to investigate the allegations that Sorenson was paid to work on a presidential campaign, which is a violation of senate rules. Sorenson will be sentenced later.

Michele Bachman at a 2011 news conference.

Michele Bachman at a 2011 news conference.

Sorenson resigned from the state senate in October soon after the independent counsel hired by the Iowa Senate Ethics Committee released a report concluding it was “manifestly clear” that Sorenson was paid to work on Bachmann’s presidential campaign. Senator Wally Horn of Cedar Rapids leads the Senate Ethics Committee.

“Iowa is squeaky clean, even though once in a while we have a problem,” Horn told Radio Iowa an hour after Sorenson resigned.

Sorenson sent an email to supporters last October saying he “did not do anything illegal” or “immoral.” Sorenson accused his attackers of a “witch hunt” and he argued the investigation had been “rigged” against him because of his public opposition to the Iowa Supreme Court’s gay marriage ruling. The first person to publicly accuse Sorenson of taking money to jump ship and join the Ron Paul campaign was Michele Bachmann.

“I had a conversation with Kent Sorenson and…he told me he that was offered money,” Bachmann said. “He was offered a lot of money by the Ron Paul campaign to go associate with the Ron Paul campaign.”

Bachmann made those comments during a news conference on December 29, 2011 — the day after Sorenson attended a Ron Paul rally to announce he was jumping from Bachmann to Paul’s camp.

F. Montgomery Brown, Sorenson’s attorney, released a written statement today, asking for privacy for Sorenson and his family.

“Mr. Sorenson’s pleas are part of the process of taking complete responsibility for the series of compounding errors and omissions he engaged in, aided and abetted, and participated in with others,” Brown wrote. “…This is a very sad day for Mr. Sorenson, his family, and his friends, many of whom were in attendance in court. To the extent others may take glee with his predicament, there is nothing that can be done.”

Sorenson owned and operated a cleaning business in Indianola before his election to the Iowa House in 2008, then he won a seat in the Iowa Senate in 2010. In a September 19, 2013 deposition that was part of the Iowa Senate Ethics Committee’s investigation of the allegations against Sorenson, he was quizzed about why he was being paid by the Ron Paul campaign.

“What was the consulting work that you were doing?” asked Mark Weinhart, the independent counsel investigating the case for the ethics committee.

Sorenson replied: “I don’t think that’s relevant to the investigation…I’m not going to answer the question.”

Weinhart also asked: “What was it that made you so valuable that they would pay, I think, well over $60,000 during the course of 2012?”

Sorenson, in his answer, suggested his value was as a future candidate for federal office.

“I don’t know if you understand how this works, but he had an interest in me possibly running for the U.S. Senate in this election cycle,” Sorenson said in the deposition. “…I would probably be one of the front-runners right now (if not for the ethics investigation). A lot of people believe that.”

(This post was updated at 3:27 p.m. with additional information.)