New report IDs billions in unemployment fraud. Is enough being done in Ohio? [Journal-News, Hamilton, Ohio]

Hamilton Journal News (OH)

Sep. 29—Editor's note: This story is part of a Dayton Daily News investigative project titled Billions in COVID aid: Where it's going. Go here for more on this project, including searchable databases showing how your community spent CARES Act funds and now much it is getting in American Rescue Plan funds.

A new U.S. Department of Labor report highlights the extent of unemployment insurance fraud during the COVID-19 pandemic across the country, including in Ohio — a problem one of Ohio's U.S. senators says more can and should be done about.

The Department of Labor Inspector General issued a report this month identifying $45.6 billion in potentially fraudulent benefits paid to people with Social Security numbers in multiple states, belonging to dead people, filed with suspicious email accounts or of federal prisoners.

More than 1,000 people have been charged with fraud involving unemployment across the country, the agency said.

"This milestone of 1,000 individuals being charged with crimes involving (unemployment) fraud and the identification of $45.6 billion in potentially fraudulent (unemployment) payments highlights the magnitude of this problem," said Inspector General Larry D. Turner.

"Hundreds of billions in pandemic funds attracted fraudsters seeking to exploit the UI program — resulting in historic levels of fraud and other improper payments."

Ohio Department of Job and Family Services officials last month said more than $1.1 billion was identified as paid out in fraudulent overpayments as of the end of June. Most of this was in a temporary program set up during the pandemic for people who don't qualify for traditional unemployment.

State officials say they have recovered or prevented the payout of nearly $400 million in fraudulent payments and sent numerous investigative referrals to federal law enforcement officials.

"Like the rest of nation, Ohio was hit hard by criminals trying to defraud unemployment over the course of the pandemic," said ODJFS spokeswoman Dasia Clemente.

"We're in a much different place now because of our investments in anti-fraud technology," Clemente said. "We've also made it a priority to better understand fraud, and how best to work with financial institutions and law enforcement to document fraud and recover stolen funds."

There have been a handful of arrests in Ohio for unemployment fraud. State and federal officials say many of the perpetrators are overseas.

U.S. Sen. Rob Portman, R-Ohio, in July introduced legislation, backed solely by fellow Republicans, to encourage states to step up insurance fraud investigations. Among other things, the Chase COVID Unemployment Fraud Act would allow states to keep 25% of any improper payments they recover and put the money toward investigations and prosecutions, as well as strengthening program integrity.

At the time, the total lost to unemployment fraud nationally was estimated at $163 billion.

"Billions of dollars spent to help American families were stolen by individual criminals and transnational criminal organizations," Portman spokeswoman Meghan Dugan said.

Dugan said in addition to the legislation and calls for more accountability from federal agencies, "(Portman) supports the continued efforts of federal, state, and local officials to bring fraudsters and criminals to justice."

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