The Government Accountability Office (GAO) estimates that the amount of unemployment insurance (UI) fraud during the coronavirus pandemic is likely between $100 billion and $135 billion, according to a new report released Tuesday.
The GAO report tracked the approximately $900 billion in UI expenditures from April 1, 2020 to May 31, which marked the official end of the public health emergency. The estimated fraud would account for about 11 percent to 15 percent of the total UI benefits during that period.
During the same time, states reported finding about $55.8 billion in overpayments, about $5.3 billion of which were fraudulent, according to the report. States reported recovering about $6.8 billion, about $1.2 billion were fraudulent.
“The unprecedented demand for UI benefits and the urgency with which states implemented the new programs during the pandemic increased the risk of improper payments, including, but not limited to, those due to fraud,” the report read.
Concerns about pandemic fraud have long been a concern, as many experts and government officials acknowledge the speed with which agencies had to act to respond to the pandemic.
This recent report, however, marks an increase in the GAO’s estimated UI fraud compared with previous reports. In December, it had said that at least $60 billion in fraudulent payments “were made to claimants by extrapolating the lower bound of DOL’s [Department of Labor’s] 2021 estimated national fraud rate for the regular UI program to total UI spending.” At the time, the GAO concluded that the rate “could be substantially higher” than the $60 billion lower limit.
“We now estimate that the amount of fraud was higher, with our new range of $100 billion to $135 billion falling above the lower limit that we reported in December 2022,” the GAO report read.
“To calculate our previous lower limit, we relied on existing evidence about the extent of fraud in the UI programs. Our current range extended this work through a substantial methodology employing independent sampling and modeling work,” it continued.
The GAO reported that DOL “expressed concerns” about the fraud estimation methodology used in the report and “and stated that the resulting estimate was likely overstated.” The GAO pushed back against the DOL’s assessment and laid out in detail the process of estimating the fraud range.
