On December 13, 2024, the House Select Subcommittee on the Coronavirus Pandemic shared the numbers for fraudulent unemployment claims paid through state unemployment insurance agencies during the COVID-19 pandemic. According to the subcommittee’s report, of the $872 billion that was allocated to pandemic unemployment insurance benefit programs, nearly $200 billion was paid out to hackers and fraudsters, a 100% uptick from the Government Accountability Office’s (GAO) previous estimation of a little more than $100 billion.
“Extending these programs, with insufficient oversight, allowed fraudsters, international criminals, and foreign adversaries to steal billions in taxpayer dollars through UI fraud,” the report says, asserting that a lapse in oversight was largely to blame. Did anyone realize before the pandemic that there are two meanings to the word “oversight?” According to the Merriam-Webster Dictionary, the word could mean either “under supervision” or “a mistake.” Oversight could also mean “attending to something.” Or quite the opposite apparently. Maybe it’s not a case of either but both. After all, the congressional leaders who created the Coronavirus Aid, Relief and Economic Security Act did not have any manual to refer to.
Kudos to the House Select Subcommittee on the Coronavirus Pandemic for including in the report recommendations for future pandemic preparedness. Suggestions included strengthening internal controls and verification processes, enhancing data sharing and integration by removing legal barriers that prevent the SSA from sharing death data with the Treasury; undergoing rigorous identity verification; and modernizing IT systems to enhance cybersecurity. Just to name a few suggestions.
As of the publication of the report, subcommittee members said that states have only recovered $1.2 billion in payments lost to fraudsters across UI and relief payment programs.
Today’s Fraud of The Day is based on article “House Report Boosts Pandemic UI Fraud Total to $191 Billion” published by MeriTalk News on December 13, 2024.
The House Select Subcommittee on the Coronavirus Pandemic has tallied up a total of $191 billion of fraudulent claims paid out through state unemployment insurance (UI) agencies to hackers and fraudsters – up from previous estimates that put the fraud figure closer to $100 billion.
That was the headline number in the subcommittee’s 557-page report made public on Dec. 5. Fueled by business lockdowns and social distancing in the initial period of the pandemic, U.S. unemployment spiked to nearly 15 percent in 2020.
