Criminals have fraudulently stolen $45.6 billion in unemployment benefits from U.S. government programs meant to assist Americans who lost their jobs during the pandemic.
The federal government started an unemployment aid program in March 2020 during the early days of the pandemic.
The hundreds of billions in pandemic aid immediately attracted criminals, who exploited the federal assistance program.
These actions resulted in "historic levels of fraud and other improper payments,” reported Larry Turner, the Labor Department's inspector general.
Unemployment fraud cost the government about $163 billion in overpayments, “with a significant portion attributable to fraud,” testified Turner to Congress.
Investigating Pandemic Aid FraudU.S. Attorney General Merrick Garland launched a COVID-19 Fraud Enforcement Task Force in May 2021 to probe acts of fraud involving federal pandemic assistance programs, such as the Paycheck Protection Program (PPP), unemployment insurance, and Medicare.
The Department of Justice tapped federal prosecutor Kevin Chambers to assist in the investigation of false claims made during the pandemic, including stealing aid from government assistance programs.
The OIG reported "an increase of $29.6 billion in potentially fraudulent payments," on top of the losses from last summer's initial report, according to the federal watchdog.
The new figure is more than three times the $16 billion in fraudulent payments that were detected by the authorities in June 2021.
More than half of the fraudulent claims were allegedly by simultaneously filing for billions of dollars in unemployment claims in multiple states.
"We determined 205,766 Social Security numbers of deceased persons were used to file claims for UI (unemployment insurance) pandemic benefits," said the report.
Others used the identities of deceased persons and federal prisoners, or those ineligible for payments and through the use of suspicious emails that were hard to trace by law enforcement.
In March 2022, federal prosecutors issued indictments for more than 1,000 cases of fraud involving jobless benefits during the pandemic.
Aimee Bock, the founder of Feeding Our Future, a Minnesota nonprofit organization, was accused of running the largest COVID-19 aid fraud scheme in the United States, along with 46 accomplices of Somali origin.
Bock has denied wrongdoing.
The pandemic assistance program gave those who lost their jobs an extra $600 a week in federal aid at first, which was later reduced to $300 a week.
The extra federal benefit package, which dished out $872 billion in aid, expired late last year.
However, the report said that some of the overspending was due to benefits sent to recipients after they had returned to work, rather than outright fraud.
Meanwhile, states across the country also saw a massive surge of unemployment fraud cases of their own after the pandemic hit.
Many state government assistance offices were swamped in early 2021 because of outdated technology that made it difficult to detect and sort through fraudulent claims.
Congress and the End of the Pandemic Emergency
The scandal is now a bipartisan issue on Capitol Hill, as lawmakers have agreed that state and federal officials must crackdown on fraud in the future.Sen. Dick Durbin (D-Ill.), for example, called for more oversight of pandemic relief funds, after his own his son was the victim of a $140,000 ID fraud scheme involving a federal PPP loan for a bogus construction company.
"There's no Durbin construction company," said Durban to reporters at the Capitol, and that "somebody had stolen his identity."
"Government-backed PPP loans were created to help small businesses survive the COVID pandemic."
The report was released as the White House is seeking $22.4 billion in new COVID-19 aid from Congress, but Republicans are opposing this, especially after President Joe Biden declared the pandemic to be "over."The Biden administration said that funding is critical to acquire more vaccines, after claiming that 100 million Americans may become infected with a variant of the virus in the fall and winter.