STATISTICAL ANALYSIS APPLICATION PROPOSALEffect of Unemployment on Disability Fraud (State of California)Who: Disability claimants in the State of CaliforniaWhat: Our hypothesis is that if as the unemployment rate increases, fraudulent disability claims will also increase. When: A total period of eight years; nearly three years before and five years after the housing market crash in late 2007. Where: State of California Why: In recent years, the Social Security Administration and Cooperative Disability Investigative Units in the State of California have seen an unusually high volume of fraudulent disability claims. These fraudulent claims have eroded the integrity of SSA programs, as well as resulted in a serious depletion of Social Security funds that are reserved as a safety net for truly disabled individuals. Desired Outcome: This study will demonstrate that fraudulent disability claims will increase as the unemployment rate increases in the State of California. Hypothesis: Research Hypothesis: If the unemployment rate increases, fraudulent disability claims will increase. Null Hypothesis: Increases in the unemployment rate have no effect on fraudulent disability claims. Measurement level: interval/ratio. The number of people filing for unemployment and fraudulent investigations for open disability claims will be counted quarterly.Independent variable: Unemployment dataDependent variable: Fraudulent investigations for open disability claims.Tool used to measure results: Bureau of Labor Statistics Data Base, Social Security Association/Office of the Inspector General and Employment Development Department database for the State of California. These databases represent... the employment rate in the middle of the paper... increased to 9.5% from 5% before the economic crisis. Actions: In response to the confirmed finding, a recommendation for further investigation questions will be submitted to the Office of the Inspector General. We propose that increased fraud detection measures be trained for line staff and implemented across the agency. These measures will deter claimants from falsifying information on their disability claims. Cost/Benefit: The cost/benefit analysis clearly shows that the long-term benefit outweighs the cost of investigating fraudulent claims activity. While a commitment to resource allocation will be required to implement the proposed changes, in the long term the benefit from implementing the proposed fraud detection measures will deter fraudulent activity and ultimately save the agency a significant amount of money.