The United States government is regularly running trillion dollar deficits. This was the last thing they needed.
And now thieves have stolen $200 billion from the federal government in a stunning criminal act.
For the 2022 fiscal year, the U.S. government ran $1.38 trillion deficit, and it’s already on pace to surpass that in FY 2023.
It’s no surprise to the American people to hear that politicians are on a spending spree.
It’s easy to be “compassionate” when the taxpayer is the one footing the bill.
But their loose handling of money has led to hundreds of billions of dollars in theft – outpacing every other decade.
According to the Labor Department’s Office of Inspector General (OIG), hundreds of billions of dollars in emergency unemployment benefits granted out during the COVID pandemic were likely lost to fraudsters, with losses estimated to be “at least” $191 billion and certainly greater.
The estimate was sent by Labor’s OIG to the House Ways and Means Committee on Wednesday morning, just hours after President Biden stated that he intends to pursue those who utilized the pandemic to steal billions of dollars in COVID funding.
“As we emerge from this crisis stronger, I’m also doubling down on prosecuting criminals who stole relief money meant to keep workers and small businesses afloat during the pandemic,” Biden said in his Tuesday night State of the Union address.
“Now, let’s triple our anti-fraud strike forces going after these criminals, double the statute of limitations on these crimes, and crack down on identity fraud by criminal syndicates stealing billions of dollars from the American people.”
According to Larry Turner, the Labor Department’s Inspector General, the federal government’s influx of COVID relief funds in 2020 will overwhelm state agencies tasked with disbursing it.
He claimed that COVID created a “perfect storm” for fraud by allowing people to self-certify that they were entitled for Pandemic Unemployment Assistance (PUA), which was distributed to millions of people who were not previously eligible for unemployment payments.
“The reliance solely on claimant self-certifications without evidence of eligibility and wages during the program’s first 9 months rendered the PUA program extremely susceptible to improper payments, including fraud,” Turner said in prepared remarks to the Ways and Means Committee.
Turner stated that for the last two decades, the normal erroneous payment rate for unemployment insurance has been greater than 10%. However, after COVID, the wrong payment rate was substantially higher, ranging between 18.71% and 21.52%.
When that figure is applied to the $888 billion in federal and state unemployment benefits paid out during the pandemic, “at least $191 billion in pandemic UI payments could have been improper payments, with a significant portion attributable to fraud,” Turner said in his remarks.
He believes that figure is a conservative estimate because the incorrect payment percentage for pandemic-era unemployment assistance was “likely higher than 21.52%.”
At the same hearing, Michael Horowitz, chair of the Department of Justice’s OIG’s Pandemic Response Accountability Committee, stated that fraud was common because state workforce agencies [SWAs] that handle unemployment insurance (UI) were not equipped to handle the influx of claims.
“Internal controls within SWAs’ unemployment programs were often reduced to handle the influx or were simply not effective enough to properly detect the high levels of fraud occurring,” he said. He also provided other cases of fraud in various states.
“A report from the Arizona Auditor General found that the Arizona SWA paid $1.6 billion in federal UI benefits to individuals who used stolen identities in Fiscal Year 2020,” Horowitz stated.
“Data from Michigan’s SWA revealed that they had provided $3.9 billion in overpayments to ineligible claimants,” he noted. “Michigan’s Auditor General emphasized that the SWA will likely be unable to recover the overpayments because the SWA was at fault, not the claimants.”
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