Pandemic jobless benefits fraud may have topped $60 billion: watchdog

Unemployment fraud from pandemic jobless benefits may have topped $60 billion, according to a new report from the U.S. Government Accountability Office (GAO).

The federal watchdog said the Labor Department reported fraud estimates of about $8.5 billion for regular unemployment insurance programs in 2021. However, the government created four new unemployment programs during the COVID-19 pandemic aimed at alleviating the toll on workers.

The GAO estimated that if the rate of fraud were extrapolated to total spending across all unemployment insurance programs during the pandemic, the fraud total would come out to more than $60 billion.

The federal government paid out around $878 billion in unemployment insurance benefits between April 2020 and September 2022, according to Labor Department statistics.

The report notes that unemployment insurance programs have long had integrity issues, and the GAO recommended that the Labor Department come up with an anti-fraud strategy based on guidance from the watchdog.

The GAO said in the report that the department “partially” agreed with the recommendation and said it plans to address it.

Labor officials said in response to the report that they are developing an unemployment insurance (UI) fraud risk profile “in tandem with ongoing antifraud efforts.”

“Prioritizing the completion of GAO’s recommendations before implementing any new antifraud strategies or efforts will not be responsive to the immediate needs of the UI system, which could unnecessarily hinder the public trust,” the department said in a letter included in the released report.

The Hill has reached out to the Labor Department for further comment.

Republicans in their new House majority have made oversight of the Biden administration one of their top priorities, including examining government spending.

The GOP-led House Oversight and Accountability Committee is planning a February hearing on the waste of taxpayer money on COVID-19 relief programs.

“We owe it to Americans to identify how hundreds of billions of taxpayer dollars spent under the guise of pandemic relief were lost to waste, fraud, abuse, and mismanagement,” Rep. James Comer (R-Ky.), the chairman of the committee, wrote in a statement announcing the hearing.

“For the past two years, the Biden Administration has allowed fraud to run rampant in federal assistance programs and Democrats in Congress conducted little oversight,” he added.