Home » Politics » Labor Department estimates $36B in improper unemployment payments in CARES Act
Labor Department estimates $36B in improper unemployment payments in CARES Act
US states see spikes in unemployment fraud
States like Massachusetts and Washington have reported a rise in cases of unemployment fraud, amounting to millions in fraudulent claims paid. FOX Business’ Edward Lawrence with more.
The Department of Labor's Office of the Inspector General estimates that at least $36 billion worth of unemployment payments expended as of Nov. 7 may have been invalid.
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The government allocated $360 billion in total unemployment funding in the $2.2 trillion Coronavirus Aid, Relief and Economic Security (CARES) Act, which passed in March.
"This is government at work – or not at work," Tom Schatz, president of the government spending watchdog Citizens Against Government Waste, told Fox News. "This doesn't happen in the private sector. Well, it does, but you go out of business."
The OIG, which has long been critical of the DOL's unemployment insurance program, said that if improper payments continue at 10%, at least $36 billion out of $360 billion expended under the $2.2 trillion CARES Act could be improperly paid, "with a significant portion attributable to fraud" – and that's a conservative estimate.
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Schatz said that the OIG has to estimate the total amount of improper spending because the DOL does not have easy access to the National Directory of New Hires, state unemployment wage records or social security administration's wage records in order "to appropriately oversee how unemployment insurance funds are used."
"That in and of itself is an issue that can be can be easily resolved," he said. "How can you track the money being spent if you don't have access to the information about where it's going?"