What happens if you lie to NYS Department of Labor unemployment - found out the hard way

I understand you're scared, but you need to take this seriously. When NYS Department of Labor finds unreported income, they can pursue several actions: overpayment recovery, monetary penalties (usually 15% of the overpayment), disqualification from future benefits, and in serious cases, criminal fraud charges. The good news is that most cases are handled civilly unless the amount is very large or there's evidence of intentional sophisticated fraud. You should respond to their investigation request immediately and consider getting legal help. Document everything you can about the unreported work - dates, amounts, circumstances. Being cooperative now is your best chance of avoiding criminal prosecution.

You're looking at an overpayment determination and potentially a fraud penalty. NYS Department of Labor takes unreported income very seriously because it's considered intentional program violation. The process usually goes: investigation → overpayment notice → appeal opportunity (if you disagree) → collection actions. Since you admitted the unreported work was intentional, your best bet is full cooperation and setting up a payment plan. They can garnish wages, intercept tax refunds, or offset other benefits to collect. The 15% fraud penalty is standard but sometimes negotiable if you're cooperative.

oh no this is exactly what I'm worried about happening to me!! I did some uber driving while collecting and reported most of it but definitely not all of it. How did they find out about your cash work? I'm so paranoid now that they're going to come after me too. Did you get any warning or did the investigation notice just show up out of nowhere?

The system is so unfair honestly. They make it impossible to survive on unemployment alone and then punish people for trying to make ends meet. I get that lying is wrong but when you're facing eviction what are you supposed to do? Meanwhile rich people get away with tax fraud all the time. Sorry you're going through this OP, it's such bs.

If you're having trouble reaching NYS Department of Labor about your overpayment case, I had good luck using Claimyr to get through to an actual agent. They helped me get connected when I couldn't get through the regular phone lines for weeks. You can check out their demo at https://youtu.be/qyftW-mnTNI and their site claimyr.com. Might be worth it to talk to someone directly about your options for payment plans or appeal procedures rather than just waiting and worrying.

Just want to say thanks for posting this because I think a lot of people don't realize how serious this stuff is. The unemployment office definitely has ways of finding out about unreported income and the penalties are no joke.

I went through something similar a few years ago and I know how overwhelming it feels right now. The most important thing is to respond to everything they send you immediately and be completely honest going forward. In my case, I owed about $3,800 in overpayments plus penalties. I was able to set up a payment plan for $150/month which made it manageable. The criminal prosecution threat is scary but from what I've seen, they usually only pursue that for much larger amounts or repeat offenders. You might also want to check if you qualify for a waiver - sometimes they'll reduce penalties if you can show financial hardship or that the overpayment wasn't entirely your fault. Document everything and keep copies of all correspondence. This too shall pass, even though it doesn't feel like it right now.

I'm dealing with something similar right now and this post really resonates with me. I made the mistake of not reporting some freelance work I was doing while on unemployment benefits, and I just got my overpayment notice last week. The amount they're claiming is around $2,800 plus penalties. Like you, I was desperate at the time and made a really poor decision. Reading through these comments has been both scary and helpful - it sounds like most people who cooperate and set up payment plans avoid the worst consequences. I'm planning to call them tomorrow to discuss my options. Thanks for being brave enough to share your experience because it helps the rest of us know we're not alone in this mess.

I really appreciate you sharing this experience - it takes courage to admit mistakes and warn others. I'm currently on unemployment and seeing your post is making me double-check that I've been reporting everything correctly. It's scary how easy it seems to be for them to find unreported income through cross-referencing records. From what everyone is saying here, it sounds like your best bet is full cooperation and setting up a payment plan. $4,200 is definitely not a small amount but it doesn't seem to be in the range where they typically pursue criminal charges. Have you considered reaching out to any local legal aid organizations? Sometimes they offer free consultations for situations like this and could help you understand your rights during the appeals process. Stay strong - this is going to be stressful but it's not the end of the world and you'll get through it.