Labor Department Allots $240 Million to Fight ‘Terrifying’ Level of Unemployment Insurance Fraud

The entrance to the Labor Department is seen near the Capitol in Washington, D.C., on May 7, 2020. J. Scott Applewhite/AP Photo

The Labor Department is giving $240 million to states for measures like beefing up cybersecurity defense and identity verification in a bid to fight an explosion of unemployment insurance fraud.

The move, announced in an Aug. 12 press release, is part of a broader thrust to modernize the unemployment insurance system, the shortcomings of which have been exposed amid a surge of fraudulent activity after federal lawmakers expanded jobless compensation programs last year in response to the outbreak.