It was bad enough that fraudsters stole tens of billions of dollars in fictitious benefits for the unemployment of the Pandemia era-it turns out that the states forgive most of this money, not even trying to return it back.
The exact amount will never be known, although it can grow by billions. A Department of Labor General Inspector accused bad decision -making and outdated systems in the States that control the unemployment program with federal background funds during pandemic.
Investigators deeply plunged into Michigan and Massachusetts, which they defined as specific offenders, and found that the states forgave people who used clearly stolen social insurance numbers or suspicious emails or physical addresses that continued to appear in other cases of fraud.
Among the claims paid by Michigan and later forgiven, it was where the person used the social insurance number outside the state, gave the address in Alabama and did not report any earnings to the pandemic. The state confirmed that this was a fraudulent statement, but still forgave money, which means that fraud was not asked to return it.
In another case, Michigan determined that the requirement was the result of the theft of personal data. A year later, this still forgave this money.
The General Inspector said that Michigan refused to recover for almost 18,000 cases of confirmed fraud.
Meanwhile, Massachusetts created a “system of honor”, so that some people asked to justify from sending overpayment in unemployment benefits.
This turned out to be a mistake, a new audit said on Monday.
Investigators chose 121 claims in which the “Refusal of a Click” program was used, and did not find that none of them had any documentation to prove that they met the standards of difficulties to maintain taxpayers' money.
What documentation existed in the files, showing that people were “guilty” and still should not have been qualified. This included some people who voluntarily leave, some who actually had work, even when they collected unemployment, and others who were dismissed for intentional misconduct.
Like Michigan, Massachusetts also paid money, and then refused to repay the requirements – statements that smelled of fraud.
This included one claim paid $ 6804, which used the social insurance number and the physical address, which were also used in the other three states. One of them was Michigan.
“Massachusetts refused to restore overpayment that had a high probability of fraud,” the inspector general concluded.
Investigators took a sample of 14, probably, fraudulent claims and managed the Massachusetts authorities. The state said that it did not noted any of them for fraud, although he determined that they have no right – after the first payment of benefits for weeks.
Five of them were actually on the list provided by the federals Massachusetts in 2022, as potentially fraudulent. Massachusetts said that he did not follow, because he had already completed the claims and listed them as overpayments.
It forgave money.
“The inability of Massachusetts to determine whether there were fraudulent claims before they refused to reimburse the overpayment, increased the likelihood that scammers were enriched with unsuitable refusals and could avoid criminal prosecution,” the audit discovered.
The inspector's report was aimed at the federal Department of Labor Office for employment and training, which controls state institutions that manage unemployment benefits.
The auditors gave five recommendations on changes, including more frequent reviews of state activities and work with states to return money from confirmed cases of fraud.
ETA did not provide a formal answer to the audit.
The General Inspector said that the States provided the abolition of rejection of high unemployment benefits, at least 10.9 billion dollars. USA, but stated that the actual amount is probably much higher.
The states accused the obsolete systems of not being tracking and reporting a refusal.
“Without accurate reporting on the restoration of the cancellation for the overpayment of the user interface related to the pandemia-as it requires the ETA department and the public does not know about the total amount of this debt funded in the federal budget, which was forgiven by states,” the audit said.
