More than $45B in insurance fraud claims during the pandemic

WASHINGTON – A government watchdog office says 1,000 people have been charged with unemployment insurance fraud for claims filed during the COVID-19 pandemic.

The labor department’s inspector general says there has been more than $45 billion in potential unemployment insurance fraud since the pandemic.

Senator Rick Scott (D-Fla.) Says the government is to blame and Drake Hagner, visiting professor at George Washington Law, agrees.

“The amount of fraud is certainly surprising,” Hagner said. “What we’re really seeing is that our state workforce agencies are fully prepared to respond to a crisis like this.”

“You should be mad at your government,” Scott said.

Antiquated computer systems mean unemployment offices cannot easily detect fraud, such as when claims are filed in multiple states or when filed under the identity of someone who is in prison or deceased.

The problem with stolen identities affects low-income workers the most because if their identity is stolen, they can’t file their case — many state unemployment systems aren’t compatible with mobile devices.

Scott recognizes the problem but says there are other issues to fix before dedicating dollars to update the computer system, and Hagner says eventually the state will need federal funding to fix the unemployment system to prevent future fraud.

“We need to find everyone who is taking advantage of the system,” Hagner said.

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