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By John Hugh DeMastri
Daily Caller News Foundation
The Department of Labor announced Thursday that 1,000 people have been charged for receiving $45.6 billion of fraudulent unemployment insurance (UI) payments since March 2020.
The pandemic overwhelmed state offices responsible for distributing benefits, with 57 million people filing initial UI claims within five months of March 2020, the DOL-OIG reported. Fraudsters were successfully able to take advantage of the chaos, filing for claims in multiple states, using fraudulent emails and using the Social Security Numbers (SSN) of dead people and federal prisoners.
Federal and state governments together paid out roughly $794 (billion) in unemployment benefits between March 2020 and July 2021, more relief than any period in history, CNBC reported. Fraudulent payouts amounting to $45.6 billion would thus account for roughly 5.75% of pandemic-related unemployment benefits.
BREAKING: Labor Department IG says $45.6 billion stolen from unemployment insurance program using social security numbers from dead people and prisoners
— Lucas Tomlinson (@LucasFoxNews) September 22, 2022
“This milestone of 1,000 individuals being charged with crimes involving UI fraud and the identification of $45.6 billion in potentially fraudulent UI payments highlights the magnitude of this problem,” said Inspector General Larry Turner in the OIG’s press release. “Hundreds of billions in pandemic funds attracted fraudsters seeking to exploit the UI program—resulting in historic levels of fraud and other improper payments.”
The DOL-OIG notes that the program was exploited with “easily attainable” personally identifiable information by both individual fraudsters and “organized criminal groups,” in its report. To combat the growing problem, the DOL-OIG subpoenaed the records of every state to build a national database of UI records.
More than 190,000 investigations into UI fraud have been launched since the pandemic began, more than 1,000 times the typical volume, the DOL-OIG reported. With less than 140 criminal investigators, the organization was forced to focus on organized crime and “large-scale identity theft schemes.”
In one case, 11 “members and associates of a gang.” were convicted for the theft of roughly $4.3 million in UI benefits, according to the DOL-OIG. While the DOL-OIG report notes that the defendants filed for approximately $20 million worth of benefits, it does not say whether the agency or the Department of Justice (DOJ), who collaborated with the DOL-OIG to combat fraud, was able to recover any of the money that was paid out.
The recently-passed CHIPs Act, which has been praised by President Joe Biden for helping to “build the future in America,” allocated $50 billion in incentives for manufacturing projects in the U.S. This is just $4.4 billion more than the fraud announced Thursday by the DOL-OIG.
The DOL-OIG declined to comment, referring the Daily Caller News Foundation to its press release.
The DOJ did not immediately respond to the DCNF’s request for comment.
This story originally was published by the Daily Caller News Foundation.
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