More Than $63 Billion In Coronavirus Unemployment Insurance Could Have Been Improper, Fraudulent, Watchdog Says

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Thomas Catenacci Energy & Environment Reporter
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More than $63 billion in coronavirus unemployment insurance payments could have been paid improperly or fraudulently, a watchdog report found.

Based on an initial analysis of unemployment insurance (UI) made throughout the pandemic, more than 10% of the $630 billion in UI funds given to Americans were improper, according to the report released Wednesday evening by the Department of Labor Office of Inspector General (OIG).

“Over the years the OIG has repeatedly reported significant concerns with DOL and State Workforce Agencies’ ability to deploy program benefits expeditiously and efficiently … particularly in response to national emergencies and disasters,” the report said. “The OIG has reiterated these concerns in light of the economic onslaught of the COVID-19 pandemic and the unprecedented levels of federal funding allocated to the UI program.”

People walk on the streets of New York City in June as businesses reopen. (Spencer Platt/Getty Images)

People walk on the streets of New York City in June as businesses reopen. (Spencer Platt/Getty Images)

While the OIG hasn’t completed its analysis of improper coronavirus UI payments, the program’s rate of improper and fraudulent payments has been above 10% for 14 of the last 17 years, the report said.

The OIG said that of the projected amount of improper UI payments made, a “significant” amount were attributable to fraud. (RELATED: Nearly 20% Of American Renters Are Behind On Payments, Analysis Shows)

The inspector general made several recommendations to the Department of Labor including giving the watchdog greater access to claims data. OIG also recommended that the department increase staffing and resources to prepare for disasters such as the coronavirus pandemic.

Millions of Americans were laid off in the wake of the coronavirus outbreak in 2020. Roughly 17.8 million Americans continue to collect unemployment benefits, according to a Bureau of Labor and Statistics report Thursday.

The U.S. economy shrank 3.5% in 2020, according to a Jan. 28 Bureau of Economic Analysis (BEA) report, the worst performance since the 1940s. The U.S. also recorded its sharpest rise in poverty since the 1960s when the poverty rate spiked to 11.8% in December.

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