Two leading Congressional Republicans are urging U.S. Department of Labor Secretary Marty Walsh to devote more funding to detect and prevent unemployment insurance fraud.
Sen. Mike Crapo (R-ID), ranking member of the Senate Finance Committee, and Rep. Kevin Brady (R-TX), ranking member of the House Ways and Means Committee, also requested information on how the $2 billion provided to the Department in the American Rescue Plan (ARPA) for fraud detection and prevention is being used.
“Since the enactment of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), and subsequent legislation, including the American Rescue Plan Act (ARPA), the federal government has pumped billions of dollars into state unemployment programs. While unemployment insurance has been a lifeline to those who have been sidelined by the pandemic, the amount of money and new programs in unemployment have become easy targets for criminals and criminal enterprises. There has been a major surge in fraud, concurringly extending to international organized crime rings and foreign actors,” Crapo and Brady wrote to Walsh.
The lawmakers expressed concern about Walsh’s recent testimony before the House Appropriations Committee, where he said that about one-third of the $2 billion designated for fraud prevention is slated for technical assistance for the states.
“Given the amount of unemployment fraud, including within the Pandemic Unemployment Assistance (PUA) program, it is important for us as Ranking Members on the Senate Finance Committee and House Committee on Ways and Means, and in our duty to perform oversight, to gain an understanding of how you plan to spend the $2 billion; any amounts you may have already spent; how much of any unspent funds you will devote to detection and prevention of fraud; and how funds spent on technical assistance to states will specifically lead to prevention, detection, and recovery of fraudulent payments,” they wrote.
They are seeking responses to these and other questions by May 27.