A report issued by the Labor Department’s inspector general paints a grim picture of the country’s unemployment assistance program, which began in 2020 under the Trump administration. Weekly benefits helped him help more than 57 million families in just his first five months of the crisis — but the program soon emerged as an attractive target for criminals.
Scammers allegedly filed billions of dollars in unemployment insurance claims simultaneously in multiple states and relied on questionable and hard-to-track emails to siphon off funds. In some cases, he used over 205,000 social security numbers for the deceased. Other criminal suspects used the identities of ineligible inmates to profit.
But officials from the Oversight Office warned that their accounts may still be incomplete.They did not have access to the latest data on federal prisoners from the Department of Justice.This 2 It turns out that two factors could lead to billions more in theft in the coming months.
The government announced Thursday that it had reached a “milestone” of prosecuting 1,000 people for crimes related to unemployment benefits during the pandemic. Kevin Chambers, director of the Justice Department’s Office of Coronavirus Enforcement, described the situation as “unprecedented fraud” in a statement. Meanwhile, the Inspector General’s Office said it has opened about 190,000 investigative cases related to unemployment insurance fraud since the start of the pandemic.
Asked about the findings, a Department of Labor spokesman pointed to responses from agencies included in the inspector general’s report. It said it is “committed” to helping states fight fraud. Pointed out recent guidance.
Covid money trail
It was the largest surge in emergency spending in US history. For two years, six laws and more than $5 trillion were aimed at breaking the deadly hold of the coronavirus pandemic. While this money has saved the U.S. economy from ruin and vaccinated millions of weapons, it has also introduced unprecedented levels of fraud, abuse, and opportunism.
The Washington Post is following the covid money trail to figure out what happened to all this cash in a year-long investigation.
A new report on unemployment fraud comes two years after the federal government approved an initial budget of nearly $5 trillion in response to the worst economic crisis since the Great Depression, and the ongoing crisis facing the federal government. It highlights the issues. That money helped keep the economy from collapsing in the early days of the pandemic, but as The Post documented in a year-long series tracking spending called the Covid Money Trail, it quickly turned into waste, fraud and abuse. became a target.
The scope of the theft was enormous. Earlier this week, federal prosecutors indicted 47 defendants in an entirely different scheme targeting a program that provides free meals to children in need. He allegedly stole more than $250 million from a meal program, which the Justice Department has described as the largest single fraud targeted at coronavirus aid so far, according to the organization Feeding Our Future.
Federal agents have sounded the alarm as well, pursuing charges involving nearly $1 trillion in loans and grants aimed at helping small businesses. But theft isn’t the only problem. The Post found that sometimes government generosity has proven ineffective or has helped fund pet projects unrelated to dealing with coronavirus. has tapped a $350 billion program aimed at strengthening its response to the crisis. Various controversial political causes, such as tax cuts and immigration crackdowns.
Starting in 2020, Congress expanded unemployment benefits to meet the scale of the crisis. For the first time, lawmakers have allowed a wider range of unemployed Americans, including contractors for gig economy companies such as Uber, to collect aid for the unemployed. And Washington repeatedly increased the size of these checks, at one point in weekly payments he added $600.
Amid historic unemployment, applicants flooded in and the state workforce agencies that administer the program were quickly overwhelmed. Many of these institutions were abandoned for years. Underfunded staff relied on decades-old computers to handle historic numbers of requests for financial assistance. As a result, millions of Americans were greatly delayed in receiving aid, creating confusion and easy access for fraudsters. Many of the scammers stole the identities of innocent Americans to obtain weekly checks in their names.
‘Rip artist magnet’: Scams siphoned billions out of pandemic unemployment benefits
Labor Department Inspector General Larry Turner said in a statement, “Hundreds of billions of dollars in pandemic funding has attracted fraudsters looking to exploit UI programs. An improper payment has occurred.
The Inspector General, who investigated the program from March to October 2020, initially uncovered over $16 billion in potential fraud in high-risk and critical areas. But watchdogs have recently started warning that the total could possibly rise significantly. Turner, who testified before Congress in March this year, said there may have been $163 billion in overpayments. The amounts are projections, calculating the total amount of money wasted based on a sample of federal spending among the nearly $900 billion in unemployment benefits made during the pandemic.
On Thursday, federal observers linked their latest estimates with fresh criticism of the Labor Department, saying investigators’ access to state unemployment data to uncover more fraud could be at risk beyond 2023. The controversy, which The Washington Post reported earlier this year, prompted the inspector general to issue warnings about its ability to conduct surveillance.
But in a formal response, the Labor Department said the claim was “not fair,” citing the fact that existing regulations still have to be amended. Separately, a White House official said Thursday, The administration said it was working to address issues related to access to data.The individual spoke on condition of anonymity to describe the private discussions.
The sheer scale of the theft has already resulted in a string of federal enforcement actions, including this week when a federal court sentenced an Illinois man to 39 months in prison for fraudulently obtaining unemployment benefits while incarcerated. is causing The Biden administration has likewise stepped up efforts to address the issue, including considering new government policies aimed at cracking down on identity theft in federal programs.
On Capitol Hill, Senator Ron Wyden, a Democrat who chairs the Senate Finance Committee, praised the “strong efforts to identify criminals.” But senators on Thursday stressed the need for a legislative review of the unemployment benefit system.
“I have long said that we need a set of technical and security standards in our national systems to better prevent this kind of fraud.We will continue our efforts to pass reforms. ‘ he said.