A federal watchdog says billions of taxpayer dollars have been wasted through unemployment programs in the past year, and that number is likely to rise.
The Government Accountability Office released a report examining unemployment benefits during the COVID pandemic that found states and territories had overpaid by $12.9 billion between March 2020 and April 2021.
The Department of Labor was given billions to detect and prevent fraud, but that wasn’t able to stop the rampant waste and abuse uncovered by the GAO.
“The American Rescue Plan Act of 2021, enacted March 11, 2021, subsequently provided DOL with $2 billion to detect and prevent fraud, promote equitable access, and ensure the timely payment of UI benefits,” the report says. “As of May 20, 2021, DOL officials said that DOL was working to develop detailed plans for this $2 billion in coordination with the Office of Management and Budget, and noted that developing spending plans across 53 states and territories involves complex considerations.”
Only a fraction of those overpayments were fraudulent.
“During the first four quarters of the pandemic combined (April 2020 through March 2021), states and territories reported about $1.3 billion in overpayments identified as fraud across the UI programs,” the report says. “States have continued to identify overpayments in the regular UI and CARES Act UI programs, and some states have begun reporting data to DOL on recovered PUA overpayments. Overpayments are not necessarily a result of fraud, though some may be. As we reported in January 2021, DOL data show that the dollar amount of state-reported overpayments in the regular UI program increased substantially during the pandemic, coinciding with historically high numbers of UI claims. States have also reported large amounts of overpayments in the CARES Act UI programs.” – READ MORE
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