Thousands of unemployment checks halted after Colorado system error

COLORADO SPRINGS, Colo. (KRDO) -- The Colorado Department of Labor and Employment (CDLE) admits a system error resulted in thousands of unemployment checks not going out on the week of Christmas.

It's an issue we first reported about on Christmas Eve after three Coloradans contacted us about not getting paid their pandemic unemployment benefits the Monday before Christmas.

Since then, several other Coloradans have reached out describing the same issue. State labor officials say thousands of accounts were incorrectly flagged during a "deep dive fraud analysis" to combat an increase in bogus claims filed in November.

CDLE released this statement to 13 Investigates on Wednesday:

"As expected, not every red flag reveals a true fraudulent claim.  System errors resulted in red flags being inadvertently raised on some valid claims and the system placed those claims on hold.  We are currently removing a large number of holds that were incorrectly placed on many claims. We removed 2,800 such holds yesterday and are removing additional holds today. Of course, not every claim that is on hold will have the hold released. Some of the suspicious indicators that our IT system caught and flagged are real and warrant an investigation. There will, however, still be a hold placed on a certain number of claims due to a variety of suspicious indicators on those claims."

It's unclear when all of the account issues will be resolved. However, the error is creating major issues for those expecting their checks more than a week ago.

"What do I tell my creditors? I mean, what do you tell those people? What do you tell your landlord? What do you tell your propane company? I'm two months behind on my propane. They won't deliver until that's caught up. They don't care," Teresa Fager said.

Many struggling Coloradans say the inability to get through to the unemployment office makes their already desperate situation more difficult.

"For so many other Coloradans this is the difference between living in a home and not eating a meal," one man on unemployment said.

At least three of the people who contacted KRDO last week had their accounts fixed after 13 Investigates got involved.

If you have an issue you want our investigative team to look into, email us at 13Investigates@krdo.com.