Massive Pandemic Unemployment Insurance Fraud Still Being Stonewalled By State Of Illinois

Massive Pandemic Unemployment Insurance Fraud Still Being Stonewalled By State Of Illinois

Authored by Mark Glennon via,

How unemployment claims were mismanaged during the COVID pandemic is shaping up as a historic fiasco. It’s therefore no surprise that the State of Illinois is stonewalling the facts about its share of the problem so aggressively.

Nationwide, the scope of unemployment insurance fraud during the pandemic is stunning. Estimates of how much state governments wrongly paid out during the pandemic reach as high as $400 billion, which is fully half of the total $800 billion paid out, as reported by NBC. The latest official estimate is $163 billion lost to fraud, which is from the U.S. Department of Labor in March.

Illinois’ share of that loss to fraud is unknown because the state won’t tell us, but it could easily be $6.5 billion, which would be its share of the Labor Department’s estimated loss. As far back as June 2021, the Chicago Tribune reported that “if the amount tracks with national estimates, it could involve billions of dollars.”

For months, some Illinois reporters have hounded the responsible Illinois agency for answers. That’s the Illinois Department of Employment Security (IDES). But neither it nor the Pritzker Administration has provided any useful answers on how much was lost, why or how it can be stopped in the future.

The most recent chapter came last week in a Freedom of Information Act response by IDES  reported by CBS Chicago.

“The agency has historically refused to publicly disclose the scope of pandemic-related unemployment fraud,” CBS said, and it FOIAd for tracer reports on one particular slice of the fraud story, which is known payments to legitimate recipients that somehow got intercepted by fraudsters.

CBS had to go to the Illinois Attorney General to force an answer out of IDES, and the response showed at least 1,000 records of intercepted payments.

That’s as if IDES merely threw CBS a bone. It tells us little because we have no idea how many other instances of intercepted payments occurred or how much fraud in other forms occurred, such as by claimants who were fictitious to begin with. And the CBS Chicago FOIA request only covered the period from March 1, 2021 through Nov. 30, 2021 — a timeframe in which in which CBS says “IDES sources said they began to see fraud numbers spike.” Why CBS would trust IDES on that is a mystery since the entire point is that IDES either doesn’t know or is hiding fraud numbers.

Some other states have been far more open about efforts together to get to the bottom of pandemic unemployment fraud. In Ohio, for example, the state’s top auditor estimates their fraud losses at about $5 billion and says openly, “The system failed at almost every conceivable level.” California publicly posts its data on estimated losses and other unemployment fraud data.

But in Illinois, we get almost nothing. About the only number IDES and the Pritzker Administration have provided is their unverified claim that they stopped some one million fraudulent claims. That’s nice, but what matters is how many they didn’t stop, how it happened and how to fix it.

The biggest reward that will come to states that have been open and honest about the fraud problem is that they likely will better control it the next time an emergency demands massive unemployment assistance. In Illinois, we can expect mistakes to be repeated.

Tyler Durden
Thu, 05/19/2022 – 17:20

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