When Congress needs to put aside $2 billion to stop fraud in one program, criminals should take heed and taxpayers should as well.
It turns out the generous unemployment insurance program Congress put into place last year to cover COVID-19-caused job losses has become a cash cow for the world’s thieves.
One company estimates over $200 billion has gone or will go to crooks and cybercriminals.
The cybersecurity firm Agari detailed how a Nigerian cybercrime ring specializing in online scams was targeting last year’s COVID-relief CARES Act unemployment insurance. Criminals “are seeing essentially trillions of dollars that is up for grabs,” Crane Hasshold, Agari’s senior director of threat research told NBC News. “This is their World Series. This is their Super Bowl.”
Unlike the one million dead people who received a combined $1.4 billion in COVID-19 stimulus checks from the IRS, thieves applying fraudulently for unemployment checks are stealing the identities of living and, often, still-working Americans. Some even file on behalf of well-known public figures.
The governor of Ohio, Mike DeWine, had an unemployment claim filed in his name, as did Illinois Attorney General Kwame Raoul, the head of his state’s law enforcement agencies.
One federal official told Congress to expect more than 10% of the funds to be lost to fraud. That was on the low end, he testified: “This Department has estimated that about 10% of the UI payments are improper under the best of times. We are in the worst of times.”
With $732 billion in federal unemployment dollars, 10 percent in improper payments would equal $73 billion lost to fraud.
The #WasteOfTheDay is presented by the forensic auditors at OpenTheBooks.com.