Blake Burman of FOX Business on the rise in unemployment fraud during the coronavirus pandemic.
A significant part of the unemployment benefits for Americans struggling during the coronavirus pandemic may be being stolen by fraudsters, according to new data.
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ID.me, a computer security company that verifies the identities of workers in 19 states, about 75% of the national population, found that more than $ 200 billion in federal assistance for unemployed Americans may have been pocketed by means of fraud. The discovery is more than triple the government’s official estimate of $ 63 billion, based on the 10% pre-pandemic fraud rate.
The company notes that about 20% of the fraud is linked to the breach of personal data, up to 10% is through social engineering and 2.5% is linked to facial correspondence, where a criminal tries to wear a mask, video or image of the victim. According to ID.me., up to 30% of complaints under the Pandemic Unemployment Assistance program, which offers benefits to self-employed and contracted Americans, are fraudulent.
An ID.me spokesman did not immediately return FOX Business’s request for comment.
The American Enterprise Institute estimates that the $ 200 billion figure could make unemployment assistance fraud the fourth largest “spending program” during the pandemic, behind the Salary Protection Program, total unemployment benefits and stimulus checks. .
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States targeted by fraudsters with some of the biggest unemployment benefits per week include California, Washington and Massachusetts.
California officials confirmed to the Los Angeles Times that $ 11.4 billion in unemployment benefits paid during the COVID-19 pandemic involve fraud – about 10% of benefits paid – while another 17% are under investigation for potential fraud.
Meanwhile, fraud losses in Washington are expected to total $ 600 million in June 2020, totaling 122,000 known or suspected fraudulent claims, according to a report by the Washington State Auditor’s Office.
In Massachusetts, it is estimated that up to $ 687 million will be paid for fraudulent claims starting in February, according to the state’s Department of Unemployment Assistance.
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According to the non-partisan Committee for a Responsible Federal Budget, lawmakers have committed $ 486 billion in funding for unemployment insurance since the start of the pandemic.
The recently approved US $ 1.8 trillion American Rescue Plan represents $ 209 billion in allowable unemployment provisions. About $ 94.3 billion has been committed to expand eligibility under the Pandemic Unemployment Assistance program.
The committee estimates that the total legislative funding committed to deal with COVID-19 has reached about $ 3.12 trillion since the start of the pandemic.
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The announcement came at a time when 770,000 Americans filed for unemployment insurance for the first time in the week ending March 13, up from the 700,000 predicted by Refinitiv economists.
Weekly unemployment insurance claims have remained high for months, hovering around four times the typical pre-crisis level, although well below the peak of nearly 7 million that was reached when home stay requests were first issued a year ago, in March. There are about 9.5 million fewer jobs than last year, in February, before the crisis started.
Continued claims, or the number of Americans receiving consecutive unemployment benefits, fell to 4.124 million, a decline of 18,000 from the previous week. The report shows that about 18.216 million Americans were receiving unemployment benefits in the week ending February 27, a decrease of 1.9 million compared to the previous week.
Fox Business Megan Henney contributed to this report