Sen. Crapo: Administration Should Let States Recover Fraudulent Payments
While the
In a letter to the
"Allowing use of blanket waivers would let states off the hook for due diligence and fact finding for large volumes of suspicious unemployment claims potentially involving billions of fraudulently obtained taxpayer dollars...
"ETA's action is particularly reckless in light of
The letter is signed by
Members also sent a letter to the
The Members wrote:
"Program integrity cannot be sacrificed for expediency. In fact, the Government Accountability Office estimated that
"Given the OIG's work ensuring the recovery of taxpayer dollars, we would like to understand how your work will continue after the UIPL, and in particular any impact on your ability to initiate and conduct investigation and prosecution of fraudulent activity in pandemic unemployment programs."
* * *
Read the letter to the DOL below:
Delivered via E-mail
To: The Honorable
Dear Secretary Walsh,
On
Allowing use of blanket waivers would let states off the hook for due diligence and fact finding for large volumes of suspicious unemployment claims potentially involving billions of fraudulently obtained taxpayer dollars.
ETA's guidance not only ignores the prevalence of fraud but is issued under dubious legal authority. We write to request an immediate stay of the effective date of this guidance and an explanation of the agency's legal authority, including whether ETA consulted with the
ETA's action is particularly reckless in light of
ETA's public statement on the new UIPL suggests that expediency is overriding integrity. Program integrity cannot be sacrificed for expediency. It is well documented that throughout the pandemic, criminal organizations, including international cybercrime rings and opportunistic foreign actors, used stolen identities to falsely claim unemployment benefits. Fraud delayed legitimate payments and turned thousands of Americans into unwitting identity theft victims./3/4/5
Now is the time to pursue and prosecute fraudulent actors. Instead, this guidance equates to sweeping under the rug what is possibly the greatest theft of taxpayer dollars in American history.
ETA provides multiple loopholes for how "states may apply blanket waiver of recovery of overpayments." For example, ETA's UIPL accepts without challenge that an individual who responded "no" to being able and available for work is entitled to a blanket waiver of recovery of overpayments with no determination as to whether the individual was truthful in their response. It appears self-certification and individual assertions are the cornerstone of the repayment waiver. This action may allow those perpetrating fraud within the UI system to continue and leaves unresolved hundreds of thousands of claims involving stolen identities belonging to identity theft victims, including first responders, government personnel and school employees.
To date, ETA has fifty-six recommendations for corrective action from the DOL-OIG. Improper payments are a historical issue that this UIPL does not seek to correct./6 The problem is only exacerbated by the lack of coordination between the OIG, state agencies, and ETA./7 The OIG has issued repeated alerts to the deficiencies of ETA's management of the UI program through state entities./8 ETA's lack of attention to these alerts and the billions of dollars in fraud raises significant concerns about the agency's ongoing management of the program and ability to combat fraud.
Even more concerning, the February guidance has the potential to significantly undermine ongoing pursuit of perpetrators of fraud and the ability to gain restitution for taxpayers.
We request an immediate stay on the effective date of UIPL No. 21-21 to better understand the agency's legal authority and decision making used to create these broad categories for blanket overpayment waivers. Please provide responses after each question instead of a narrative format by
* To reduce hardship on individuals who may have been victims of identity theft or agency error, CARES Act provides limited authority for states to waive, on a case-by-case basis, overpayments in pandemic unemployment programs if the overpayment was through no fault of the individual. What legal justification or rationale did the Department use to construe this limited authority to mean ETA could use administrative discretion to create seven broad categories of blanket overpayment waivers?
* Did ETA conduct an economic analysis of this UIPL's impact? If so, please provide a copy of that analysis. If not, why?
* What is ETA's overall estimate for the number and dollar value of claims that fall into each of the five new waiver categories? Please provide a state-by-state breakdown of these two data points for each of the 53 UI systems.
* Provide the date on which the states added the list of COVID-19 qualifying reasons to their initial PUA claim application? And the date states began approving COVID-19 related to the PUA claim application?
* How does the Department plan to reduce friction in State Workforce Agencies' ability to validate self-employment or independent work earnings?
* Did ETA consult with the OIG to determine the impact of this UIPL on current investigations? If yes, please provide all communications or documents received from the OIG on this topic. If not, why?
* Does this UIPL address any of the OIG's outstanding recommendations to fix ETA's administration of the unemployment insurance program?
* Does ETA has a plan to address any of the OIG's outstanding recommendations to fix ETA's administration of the unemployment insurance program?
* Did ETA consult the
* What role did the
Thank you for your attention to this matter.
Sincerely,
* * *
Footnotes:
1
2
3 "DOL-OIG Oversight of the
4 "COVID-19: Critical Vaccine Distribution, Supply Chain, Program Integrity, and other Challenges Require Focused Federal Attention," Government Accountability Office,
5 "Massive Fraud Against Unemployment Insurance Programs,
6 https://www.oig.dol.gov/public/reports/oa/2021/04-21-001-03-315.pdf
7 https://www.oig.dol.gov/public/reports/oa/2021/19-21-006-03-315.pdf
8 https://www.oig.dol.gov/public/reports/oa/2021/19-21-002-03-315.pdf
9 https://www.oig.dol.gov/doloiguioversightwork.htm
* * *
Read the letter to the DOL-OIG below:
Delivered Via E-mail
To: The Honorable
Dear General Turner:
On
Program integrity cannot be sacrificed for expediency. In fact, the Government Accountability Office estimated that
ETA's statement on the new UIPL suggests that expediency may in fact be the case. ETA provides five new loopholes for how "states may apply blanket waiver of recovery of overpayments" but fail to require any determination of whether fraud existed. While the UIPL states there is legal authority for such action, it is unclear if this accurate.
Given the OIG's work ensuring the recovery of taxpayer dollars, we would like to understand how your work will continue after the UIPL, and in particular any impact on your ability to initiate and conduct investigation and prosecution of fraudulent activity in pandemic unemployment programs. Please provide answers to the questions below by
1. Did ETA consult with the OIG to ensure these waivers would not impact existing investigations? If so, what was OIG's response?
2. Did ETA consult with the OIG to confirm the UIPL was in accordance with the law? If so, what legal opinion did OIG provide?
3. Will ETA's interpretation adversely impact the OIG's pursuit of fraud in the UI program?
4. Is ETA adequately responding to the OIG's outstanding report recommendations?
5. Is there a possibility that the UIPL will allow for fraudulent CARES Act unemployment insurance payments to go uncollected?
Thank you for your attention to this matter.
Sincerely,
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