Criminals have fraudulently stolen $45.6 billion in unemployment benefits from US government programs designed to help Americans who have lost their jobs during the pandemic.
The federal government launched an unemployment assistance program in March 2020 in the early days of the pandemic.
The hundreds of billions in pandemic aid immediately attracted criminals who took advantage of the federal aid program.
The scammers used common tactics between March 2020 and April 2022, such as illegally using social security numbers of people who are not eligible for unemployment insurance, according to a report released Sept. 22 by the Department of Labor’s Office of the Inspector General (OIG).
These actions resulted in “historic levels of fraud and other improper payments,” reported Larry Turner, the Department of Labor’s inspector general.
Unemployment fraud has cost the government about $163 billion in overpayments, “a significant portion of which is due to fraud,” Turner testified before Congress.
The department responded in a drafted letter to the Wall Street Journal that it agreed with its inspector general about the increase in federal aid fraud during the pandemic and said it was committed to developing new tools and strategies to combat these criminal acts Find.
Pandemic Aid Fraud Investigation
US Attorney General Merrick Garland created a COVID-19 Fraud Enforcement Task Force in May 2021 to investigate fraud related to federal pandemic relief programs such as the Paycheck Protection Program (PPP), unemployment insurance and Medicare.
The Justice Department has hired federal prosecutor Kevin Chambers to help investigate false claims made during the pandemic, including theft of aid from federal aid programs.
The OIG reported “a $29.6 billion increase in potentially fraudulent payments,” according to the federal regulator, on top of losses from last summer’s initial report.
The new figure is more than triple the $16 billion in fraudulent payments uncovered by authorities in June 2021.
More than half of the fraudulent claims were allegedly based on the simultaneous filing of billions of dollars in unemployment claims in multiple states.
“We found that 205,766 social security numbers of deceased persons were used to file claims for unemployment insurance (UI) pandemic benefits,” the report said.
Others used the identities of deceased and federal prisoners or those ineligible for payments, and through the use of suspicious emails that were difficult for law enforcement to trace.
In March 2022, federal prosecutors filed indictments for more than 1,000 counts of unemployment benefit fraud during the pandemic.
The Justice Department announced Sept. 20 that prosecutors had filed indictments against 47 defendants for allegedly stealing $250 million from a U.S. government aid program aimed at feeding needy children during the pandemic.
Aimee Bock, the founder of Feeding Our Future, a Minnesota nonprofit, has been accused of running the largest COVID-19 aid scam scheme in the United States along with 46 Somali-origin accomplices.
Bock denies wrongdoing.
The pandemic relief program initially provided those who lost their jobs with an additional $600 a week in federal assistance, which was later reduced to $300 a week.
The supplementary federal benefit package that handed out $872 billion in aid expired late last year.
According to a June report by the Government Accountability Office, at least 19 percent of unemployment benefits were misinvested during the pandemic, up from about 9 percent before the pandemic.
But the report says some of the overspending was due to benefits sent to recipients after they returned to work, rather than outright fraud.
Meanwhile, states across the country also saw a massive spike in unemployment fraud cases following the outbreak of the pandemic.
Many state government aid offices were overwhelmed in early 2021 because of outdated technology that made it difficult to spot and sort through fraudulent applications.
It also found that the federal government allowed more than $1.3 billion to be transferred to foreign applicants, raising concerns that money was inadvertently being sent overseas to fund crime syndicates and terrorist organizations.
Congress and the end of the pandemic emergency
The scandal is now a bipartisan issue on Capitol Hill as lawmakers agreed state and federal officials must take action against fraud going forward.
Sen. Dick Durbin (D-Ill.), for example, called for increased oversight of pandemic relief funds after his own son was the victim of a $140,000 ID fraud scheme involving a federal PPP loan for a fake construction company went.
“There is no Durbin construction company,” Durban told reporters at the Capitol, and “someone stole his identity.”
“Government-backed PPP loans were created to help small businesses survive the COVID pandemic.”
“Fraud related to pandemic unemployment programs has reached staggering levels,” Rob Portman (R-Ohio) said in a press statement with Senators James Lankford (R-Okla.) and Mike Crapo (R-Ind.) in July.
“Billions of taxpayer dollars from hard-working Americans meant to help unemployed Americans went to criminals and scammers instead. This legislation will give states the incentives and tools necessary to recover this stolen money.”
The report came as the White House is seeking $22.4 billion in new COVID-19 aid from Congress, but Republicans are declining, especially after President Joe Biden declared the pandemic “over.”
The Biden administration said funding was critical to acquiring more vaccines after claiming 100 million Americans could be infected with a variant of the virus in the fall and winter.
When the pandemic is over, “all emergency powers of the President were based on a pandemic [and] Each governor’s emergency powers should be lifted tomorrow, Rep. Thomas Massie (R-Ky.) wrote in a tweet .