Sec. 2. Findings
419 words·~2 min read·
/bill/117/s/4507/is/section-2·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Congress finds the following: Throughout the COVID–19 pandemic criminal organizations, including international cybercrime rings and opportunistic foreign actors, exploited a national crisis to steal billions from American taxpayers. Fraud delayed legitimate payments to unemployed workers and turned thousands of Americans into unwitting identity theft victims. The size, scope, and severity of pandemic unemployment fraud is not fully known. The Labor Department’s Office of the Inspector General estimates that at least $163 billion of the $872.5 billion in Federal-State unemployment benefits paid during the pandemic could have been improperly paid, with a significant portion attributable to fraud.
Just over $4 billion of these funds have been recovered. The White House has estimated an 18.71 percent improper payment rate in the Federal-State unemployment insurance program in fiscal year 2021. This estimate does not include improper payments made in the Pandemic Unemployment Assistance program, nor does it include the period of greatest fraudulent activity when generous $600 weekly Federal supplements made unemployment a lucrative target for fraudsters. According to the Government Accountability Office, from March 2020 through October 2021, 145 individuals pleaded guilty to Federal charges of defrauding unemployment insurance programs and Federal charges are pending against 250 individuals.
As of January 2022, the Labor Department’s Inspector General reported opening more than 31,000 investigative matters involving alleged unemployment fraud and reported that it assisted other Federal and State agencies in identifying and recovering more than $565 million in fraudulently stolen unemployment benefits. In California, State workforce officials confirmed they paid out fraudulent unemployment claims totaling $11 billion and identified another $20 billion in claims still under investigation.
The Pandemic Response Accountability Committee published a report compiling the results of investigations from 16 State auditors, finding $39 billion in pandemic unemployment fraud. There is growing evidence that criminal groups perpetrating unemployment fraud pose a threat to national security. According to the Department of Justice and U.S. Secret Service, a significant amount of fraud was driven by known transnational organized criminal networks, including cartels with origins in countries including China, Ghana, Nigeria, Romania, and Russia.
The Department of Justice reports that the International Organized Crime Intelligence Operations Center has referred a large number of unemployment fraud cases to the Federal Bureau of Investigation. The American people expect Congress to be an effective steward of taxpayer dollars and vigilant in pursuit and recovery of funds when taxpayer dollars are improperly paid. Congress has a responsibility to gain restitution for American taxpayers by ensuring aggressive identification, investigation, and prosecution of criminal fraud in pandemic unemployment programs.