Attorney for Benefits Recoupment Defense

Receiving a notice that a government agency intends to recoup public benefits you have already received can be financially devastating and emotionally overwhelming. Whether the New York State Department of Labor, the Human Resources Administration (HRA), the Social Security Administration, or another agency claims you were overpaid, the consequences can include wage garnishment, tax refund interception, loss of future benefits, and even allegations of fraud. Our New York City benefits recoupment defense attorneys help individuals, families, and small business owners challenge overpayment determinations, negotiate fair repayment terms, and protect their rights at every stage of the administrative process.

What Is Benefits Recoupment?

Benefits recoupment is the process by which a government agency seeks to recover money it claims was improperly paid to a recipient. In New York, recoupment actions frequently arise after an agency conducts an audit, receives a tip, identifies a data-matching discrepancy, or reclassifies a recipient's eligibility months or even years after benefits were issued. The agency may demand a lump-sum repayment, deduct future benefits, garnish wages, intercept state and federal tax refunds, place liens on real property, or refer the matter for civil or criminal prosecution.

An overpayment notice does not mean you are guilty of wrongdoing. Many recoupment demands result from agency errors, miscommunication, incomplete records, or misapplication of New York eligibility rules. Acting quickly with the help of an experienced attorney is critical because most recoupment notices contain short appeal deadlines—often as little as 10 to 60 days, depending on the program.

Common Types of Benefits Recoupment Cases We Handle in New York City

Our firm represents clients in a wide range of benefits overpayment matters throughout the five boroughs, including:

Unemployment Insurance Overpayments

The New York State Department of Labor (NYSDOL) routinely audits unemployment insurance claims, particularly pandemic-era claims that involved expanded benefits such as Pandemic Unemployment Assistance (PUA) and Federal Pandemic Unemployment Compensation (FPUC). Recipients may receive a Notice of Determination alleging overpayment, willful misrepresentation, or false statement penalties. Willful misrepresentation findings under New York Labor Law § 594 can result in forfeit penalty days, monetary penalties of up to 15% of the overpayment (or $100, whichever is greater), and disqualification from future benefits.

SNAP (Food Stamps) Overpayments

The HRA Bureau of Fraud Investigation (BFI) and the Office of Temporary and Disability Assistance (OTDA) classify SNAP overpayments as agency error, inadvertent household error, or intentional program violation (IPV). IPV findings are particularly serious and can result in disqualification from SNAP for 12 months for a first offense, 24 months for a second offense, and permanent disqualification for a third offense.

Medicaid Recoupment

The New York State Office of the Medicaid Inspector General (OMIG) and HRA can demand repayment of Medicaid benefits when they determine a recipient was ineligible due to unreported income, assets, or household composition. Estate recovery claims under New York Social Services Law § 369 may also seek reimbursement from a deceased recipient's estate.

Cash Assistance and Public Assistance Overpayments

HRA may pursue recoupment of Temporary Assistance, Safety Net Assistance, and Family Assistance benefits. These cases often involve disputes over reported income, household members, or shelter expenses.

Social Security and SSI Overpayments

The Social Security Administration frequently issues overpayment notices for Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) benefits when it determines a recipient's resources, income, or living arrangements changed. We help clients in New York City pursue requests for reconsideration, waivers based on lack of fault, and reduced repayment plans.

Workers' Compensation and Disability Benefits

The New York State Workers' Compensation Board and disability insurance carriers may seek recoupment when they allege a claimant returned to work, received concurrent benefits, or misrepresented their condition.

Childcare and Housing Subsidy Recoupment

NYCHA, HPD Section 8, and childcare voucher programs administered through HRA and the Administration for Children's Services (ACS) may pursue recoupment for unreported income or household changes.

Why Recoupment Notices Are Often Wrong

In our experience, a significant percentage of benefits overpayment determinations in New York contain errors. Common defenses and grounds for reversal include:

• Agency calculation errors — incorrect income figures, double-counted earnings, or misapplied deduction rules
• Lack of notice — the recipient never received required forms, requests for documentation, or recertification notices
• Eligibility was actually proper — the recipient met all program rules at the time benefits were paid
• No willful misrepresentation — any error was unintentional and the recipient lacked intent to defraud
• Statute of limitations — the agency waited too long to pursue recoupment under applicable New York law
• Equitable estoppel — the recipient reasonably relied on agency advice or written guidance
• Financial hardship waiver — repayment would defeat the purpose of the program or cause undue hardship

The New York Recoupment Defense Process

The procedures for challenging a benefits recoupment vary by program, but most follow a similar administrative path:

Step 1: Notice of Overpayment or Determination

The agency issues a written notice describing the alleged overpayment, the amount, the basis for the claim, and the appeal rights. Read this notice carefully and note the deadline. For NYSDOL unemployment determinations, you typically have 30 days to request a hearing. For HRA SNAP and cash assistance matters, you generally have 60 days (or 10 days to stop aid pending appeal) to request a Fair Hearing through OTDA.

Step 2: Requesting a Hearing

Filing a timely hearing request is the most important step. A request for a Fair Hearing can be made by phone, online through the OTDA portal, by fax, or by mail. For unemployment matters, hearings are conducted by the Unemployment Insurance Appeal Board. Missing the deadline can forfeit your right to challenge the determination.

Step 3: Pre-Hearing Discovery and Preparation

Our attorneys obtain the agency's file, review the evidence relied upon, gather pay stubs, bank records, lease agreements, medical records, and other documents, and prepare witnesses. We identify legal defenses under New York Social Services Law, Labor Law, and federal regulations.

Step 4: The Administrative Hearing

At the hearing, an Administrative Law Judge or Hearing Officer takes testimony, reviews documents, and rules on whether the overpayment is valid. The agency carries the burden of proving the overpayment occurred, and we cross-examine its witnesses, present exhibits, and make legal arguments.

Step 5: Decision and Further Appeals

If the decision is unfavorable, additional appeals may be available through the Unemployment Insurance Appeal Board, an Article 78 proceeding in New York State Supreme Court, or federal court for Social Security matters.

What Happens If You Ignore a Recoupment Notice

Failing to respond to a benefits recoupment notice almost always leads to worse outcomes. New York agencies have powerful collection tools, including:

• Wage garnishment without a court judgment in certain programs
• Interception of New York State and federal tax refunds through the Treasury Offset Program
• Reduction or termination of current and future benefits
• Reporting the debt to credit bureaus
• Civil lawsuits for collection
• Referral to the New York County District Attorney, Bronx District Attorney, Kings County District Attorney, Queens District Attorney, or Richmond County District Attorney for welfare fraud prosecution under Penal Law Article 158

Welfare fraud charges in New York are graded by the amount allegedly stolen and can range from a Class A misdemeanor to a Class B felony, with potential prison time of up to 25 years for the most serious offenses.

Negotiating Repayment and Compromise Agreements

When the overpayment cannot be entirely eliminated, we work to minimize the financial impact through:

• Waiver requests — seeking complete elimination of repayment based on lack of fault and financial hardship
• Compromise settlements — negotiating to accept a reduced lump sum to resolve the debt
• Affordable repayment plans — establishing monthly payments based on the client's ability to pay
• Removing fraud or willful misrepresentation findings — eliminating penalties and future eligibility consequences even when some repayment is required

Why Hire a New York City Benefits Recoupment Attorney

The administrative process is technical, deadline-driven, and stacked in favor of the agency. Hearing officers handle hundreds of cases and rely heavily on the agency's documentation. Recipients who appear without counsel often do not know what evidence to introduce, how to cross-examine investigators, or how to invoke procedural protections. Our attorneys understand:

• New York Social Services Law and Labor Law
• OTDA, NYSDOL, and HRA regulations and internal procedures
• Federal SNAP, SSI, and SSDI rules
• The interplay between civil recoupment and potential criminal fraud allegations
• Article 78 judicial review standards in New York State Supreme Court

We approach every case with the goal of preserving your benefits, eliminating or reducing repayment liability, avoiding fraud findings, and shielding you from criminal exposure.

Contact Our New York City Benefits Recoupment Defense Attorneys

If you have received an overpayment notice, a request for repayment, a fraud investigation letter, or a subpoena from an agency in New York City, do not wait. Deadlines are short, and early intervention dramatically improves outcomes. Our attorneys represent clients in Manhattan, Brooklyn, Queens, the Bronx, and Staten Island in administrative hearings, appeals, and related civil and criminal matters. Contact our office today to schedule a confidential consultation and learn how we can defend your benefits, your finances, and your future.

You can contact us by phone at 212-233-1233 or by email at [email protected].