Prosecuting Fraudsters for Stealing Billions in Unemployment Benefits from American Workers
House Subcommittee on Work and Welfare
2025-02-06
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Source: Congress.gov
Participants
Transcript
The subcommittee will come to order. I want to welcome everybody today to our Work and Welfare Subcommittee titled, Times Running Out, Prosecuting Fraudsters for Stealing Billions in Unemployment Benefits from American Workers. I want to welcome our witnesses here today and thank you for traveling to be a part of this hearing. And I want to also welcome our new members to the subcommittee. A few of them are here. I want to welcome Rudy Yakim from Indiana, who's a new member of Ways and Means and the subcommittee, and Aaron Beam, FROM FLORIDA AS A NEW MEMBER HERE, TOO, AND WELCOME BACK OUR OLD MEMBERS. AND HE'S NOT NEW TO WAYS AND MEANS, BUT NEW TO THE SUBCOMMITTEE, RANDY FEENSTRA FROM IOWA. RANDY, WELCOME TO THE SUBCOMMITTEE ON WORK AND WELFARE. As the returning chairman of the subcommittee, we have a unique opportunity to build on our past bipartisan work and look forward to working with all of you. My district that I cover is the 16th congressional district, which covers much of central and northwestern part of Illinois. The purpose of today's hearing is to learn how Congress can hold fraudsters, how we can identify fraudsters and other criminal organizations accountable by extending the statute of limitation for CARES, Act-related unemployment insurance fraud, which will expire on March 27th of 2025 without congressional action. The Ways and Means Committee has conducted considerable oversight since the UI program's weaknesses were exposed during the COVID-19 pandemic. In February of 2023, the committee held a hearing with the government witnesses from the GAO and the Pandemic Response Accountability Committee who testified to problems with outdated state systems and weak online security that made the program vulnerable to fraud. Subsequently, in May of 2023, the House passed the Protecting Taxpayers and Victims of Unemployment Fraud Act. The bill would have extended the statute of limitations for an additional five years and incentivized states to go after fraud and recover funds.
It also included program integrity reforms to stop the pay and chase model of benefit delivery. Unfortunately, those reforms fell short of becoming law, and congressional action is needed now more than ever. All told, for the unemployment insurance program alone, GAO has estimated between 100 and 135 billion was lost to fraud during the pandemic. That number is astounding. Even more concerning, the Department of Labor tells us that only 5 billion has thus far been recovered. Meanwhile, We know law enforcement agencies have thousands of cases currently pending. The Department of Justice has charged more than 600 criminal UI fraud cases with associated losses of over 300 million.
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