Watchdogs say federal unemployment fraud likely topped $191 billion

By BRETT ROWLAND THE CENTER SQUARE

(The Center Square) – Slightly more than $1 out of every $5 distributed in unemployment insurance payments during the pandemic could have been improper, mostly fraud.

Larry Turner, the inspector general for the U.S. Department of Labor, said Wednesday that of the more than $888 billion in total federal and state unemployment insurance benefits distributed during the pandemic at least $191 billion could have been improper payments, “with a significant portion attributable to fraud.” Mr. Turner told members of the House Ways and Means Committee during a hearing. That’s up from a previous estimate of $163 billion.

“The reliance solely on claimant self-certifications without evidence of eligibility and wages during the program’s first nine months rendered the Pandemic Unemployment Assistance program extremely susceptible to fraud,” he said.

The meeting, held in workshop format, will be open to the public to attend, but neither a live video stream nor a video recording will be available to view.

to campaign finance rules, as well as other matters regarding council procedures. Another subject on the limited agenda is the council retreat, at which, among other things, council members are expected to discuss holding a future workshop to address issues related to accessory dwelling units. email: nhartsteinnewspress@ gmail.com

WENDY McCAW . . . . . . . . . . . . . Co-Publisher

ARTHUR VON WIESENBERGER . . . . .Co-Publisher

YOLANDA APODACA . . . . . . . . . . . Director of Operations

DAVE MASON . . . . . . . . . . . . . . . . . . Managing Editor

HOW TO REACH US . . .

MAIN OFFICE 715 Anacapa St. Santa Barbara, 93101..805-564-5200

MAILING ADDRESS

P.O. Box 1359, Santa Barbara 93102

NEWSROOM ADVERTISING

The Pandemic Unemployment Assistance program provided unemployment insurance benefits to people who were traditionally not eligible for benefits, including gig workers, self-employed workers and independent contractors.

States administer unemployment insurance with oversight from the U.S. Department of Labor. In place for more than eight decades, the joint state-federal program serves as a safety net for people who lose their job through no fault of their own. When the pandemic hit, a combination of factors resulted in a spike in improper payments and fraud. A 2022 audit found that fraudulent claims were paid 60.5% of the time from March 28, 2020, to Sept. 30, 2020.

“This created multiple high-reward targets where an individual could make a fraudulent claim with relatively low risk of being caught,” Mr. Turner said. “For example, as time went on, one fraudster could have been issued several UI debit cards, with tens of thousands of dollars on each card.”

As an example, Mr. Turner cited a person who filed a claim from a three-bedroom house that was the shared location for 90 other claims. The same person also shared a flagged email address with 145 other claims. In total, that person was connected to 235 other claims in three states and got benefits on 87 of those claims, all filed in California, for a total of $1,569,762. California stopped payment 164 days after the initial payment when officials were unable to verify the person’s identity, according to that 2022 audit.

Part of the problem was the nature of the crisis. The pandemic and governments’ response to it put millions of people out of work in a matter of weeks. Unemployment levels rose to historic levels. On March 14, 2020, the Department of Labor reported 282,000 initial unemployment claims. Within weeks, initial claims rose to 10 times pre-pandemic levels, “far

Please see FRAUD on A4

News Hotline 805-564-5277

Email...dmason@newspress.com

Life 805-564-5277

Sports 805-564-5177

News Fax 805-966-6258

Corrections 805-564-5277

Classified 805-963-4391

Classified Fax 805-966-1421

Retail 805-564-5139

Retail Fax 805-564-5189

Toll Free 1-800-423-8304

Voices/editorial pages ..805-564-5277

COPYRIGHT ©202 SANTA BARBARA NEWS-PRESS

All rights are reserved on material produced by the News-Press, including stories, photos, graphics, maps and advertising. News-Press material is the property of Ampersand Publishing LLC. Reproduction or nonpersonal usage for any purpose without written permission of the News-Press is expressly prohibited. Other material, including news service stories, comics, syndicated features and columns, may be protected by separate copyrights and trademarks. Their presentation by the News-Press is with permission limited to one-time publication and does not permit other use without written release by the original rights holder.

HOW TO GET US . . . CIRCULATION ISSUES 805-966-7171 refunds@newspress.com newsubscriptions@newspress.com vacationholds@newspress.com cancellations@newspress.com

Mail delivery of the News-Press is available in most of Santa Barbara County. If you do not receive your paper Monday through Saturday, please call our Circulation Department. The Circulation Department is open Monday - Saturday 8 a.m. to noon.

SUBSCRIPTION RATES www.newspress.com Newspress.com is a local virtual community network providing information about Santa Barbara, in addition to the online edition of the News-Press.

Mail delivery in Santa Barbara County: $5.08 per week includes sales tax, daily, and the Weekend edition. Holidays only, $3.85 per week includes sales tax. Single-copy price of 75 cents daily and $2 Weekend edition includes sales tax at vending racks. Tax may be added to copies puchased elsewhere.

VOL. 167 NO.