State and federal governments likely paid out at least $191 billion to ineligible unemployment claimants during the pandemic — around $28 billion more than previously estimated, officials acknowledged Wednesday.
A “significant portion” of the funny money was “attributable to fraud,” Department of Labor Inspector General Larry Turner said in prepared testimony before the House Ways and Means Committee.
According to Turner, at least one out of every five unemployment benefit dollars paid out since early 2020 were either improperly given to the same people in multiple states, dead people, prisoners or those with suspicious email accounts.
Last year, Turner estimated that at least $163 billion could have been improperly distributed since the onset of coronavirus in the US.
Criminals were able to game the system because many states were not prepared for the “extraordinary volume” of new claims and governments prioritized getting cash quickly to newly unemployed applicants over making sure safeguards to protect against fraud were in place, he told lawmakers.
In one egregious case, officials found that a claim filed from a 3-bedroom house shared the same physical address as 90 other claims and the same email address as 145 additional applications. The fraudsters behind that scam netted $1.5 million in stolen benefits, the IG said. --->READ MORE HERE
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| Photo: Andrew Kelly/REUTERS |
Watchdog told Congress that lowered standards meant to speed up payments made it easier for fraudulent benefits
The U.S. government may have paid out $191 billion in improper pandemic unemployment benefits, the Labor Department’s watchdog told Congress on Wednesday.
Larry Turner, the inspector general of the Labor Department, said his agency estimated that more than a fifth of the $888 billion federal and state unemployment payments for job losses in 2020 and 2021 may have gone to improper recipients or fraudsters.
About 22 million jobs were lost in the early months of the pandemic in 2020 and the unemployment rate rose to 14.7% in April 2020, the highest on records back to the late 1940s.
Pandemic relief laws that Congress passed and President Donald Trump signed into law in 2020 increased the amount paid through unemployment insurance and extended the time recipients could receive payments. In some cases, lower-wage workers received more in benefits than their former paychecks.
The combination of job loss and generous benefits caused a surge in applications to more than 1 million a week for much of the spring and summer of 2020. The influx of money and unemployment claims led to long hold times and delays in getting payments. --->READ MORE HEREFollow links below to relevant/related stories and resources:
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