NEWS & ANALYSIS

Incorrect COVID-19 Unemployment Payments Could Reach $87 Billion


A recent Department of Labor audit suggests that, thanks to a lack of oversight, improper COVID-19 unemployment benefits could reach $87 billion. 

As reported by Just the News, “at least $39.2 billion in improper payments, including fraud, were at risk of not being detected and recovered.” 

“Specifically,” the audit found, “DOL’s guidance and oversight did not ensure states implemented the programs and paid benefits promptly; performed required and recommended improper payment detection and recovery activities; and reported accurate and completed program activities.” 

According to the Office of Inspector General, the failures “occurred primarily because states’ IT systems were not modernized, staffing resources were insufficient to manage the increased number of new claims, and according to state officials, guidance from [the Employment and Training Administration] was untimely and unclear.” 

The report was published after the Inspector General sent a memo alerting the Department of Labor that they found $5.4 billion in potentially fraudulent claims paid to prisoners, dead people, multistate claimants and suspicious accounts from March to October of 2020. 

The Inspector General found that social security numbers of prisoners and dead people were used to fraudulently claim unemployment benefits. 

To be exact, $58.7 million was sent to dead people, $98.3 million to federal and state prisoners, $3.5 billion to multistate claimants, and $2 billion in claims to suspicious and disposable e-mail accounts. 

The Inspector General says that improper payments could reach $87.3 billion by September, when the CARES Act extensions end.