Watchdogs say federal unemployment fraud likely topped $191 billion

 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." Turner told members of the House Ways and Means Committee during a hearing.

"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 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.

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, Turner cited a person who filed a claim from a three-bedroom house that was the shared location for 90 other claims.

On March 14, 2020, the Department of Labor reported 282,000 initial unemployment claims.

Within five months, the Department of Labor reported 57.4 million initial claims, the largest increase since the agency began tracking unemployment insurance data in 1967.

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