The inspector general for the Department of Labor told a House committee on Wednesday that at least $191 billion in unemployment benefits paid during the coronavirus pandemic could have been disbursed improperly.
Larry Turner testified in front of the House Ways and Means Committee that more than $888 billion in total federal and state unemployment insurance benefits were paid during the pandemic, much of it coming through the CARES Act, which was passed by Congress in March 2020 and signed by President Donald Trump.
"At least $191 billion in pandemic [unemployment insurance] payments could have been improper payments, with a significant portion attributable to fraud," Turner said.
That figure is nearly $30 billion higher than what Turner told the Democratic-controlled House Homeland Security and Governmental Affairs committee last year. New data from the Employment Training Administration, the agency responsible for providing program direction and oversight, led to the revised figure.
"For more than two years, Republicans have been sounding the alarm about the greatest theft of taxpayer dollars in American history, the massive fraud perpetrated in the unemployment insurance program that skyrocketed with the COVID-19 pandemic," said U.S. Rep. Jason Smith, R-Mo., chair of the Ways and Means committee.
Turner said in one audit, his office found a claim that was filed from a three-bedroom house that shared the same address as 90 other claims and used the same email address as 145 other claims.
"In total, the likely fraudsters received $1,569,762 in unemployment benefits," he said.
Gene Dodaro, the comptroller general for the Government Accountability Office, testified that based on an analysis of Department of Justice public statements and court documents, from March 2020 through Jan. 13, "at least 380 individuals pleaded guilty to and three individuals were convicted at trial of federal charges of defrauding [unemployment insurance] programs. Of the 380, at least 40 also pleaded guilty to fraud related to other pandemic relief programs."
"Because of shortcomings in managing risk strategically, including lack of appropriate internal controls, [the Labor Department] and the states were not adequately prepared to handle [unemployment insurance] fraud risks when the pandemic began," Dodaro said.
Michael Horowitz, chair of the Pandemic Response Accountability Committee, testified that since a December 2021 report on challenges 16 states experienced, his committee has seen an increase in the number of states reporting fraud cases involving state workforce agency employees, including Washington, Louisiana, and West Virginia.
Also, he said, multiple states paid benefits to ineligible individuals, including prisoners, with California estimating it sent $800 million in benefits to 45,000 prisoners. He said there was one case where a single Social Security number was used to apply for unemployment benefits in 40 states, resulting in the disbursement of a total of $222,532 from 29 of those states.
"One of our highest responsibilities as legislators is to be good stewards of the American people's hard-earned tax dollars," Smith said. "This hearing is so important and sadly long overdue."