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* NBC News reports on the massive fraud involving pandemic benefits. It’s likely the biggest swindle ever pulled anywhere. The whole story is a must-read, but here are a few excerpts…
Officials and analysts say both domestic and foreign fraudsters took advantage of an already weak system of unemployment verification maintained by the states, which has been flagged for years by federal watchdogs. Adding to the vulnerability, states made it easier to apply for Covid benefits online during the pandemic, and officials felt pressure to expedite processing. The federal government also rolled out new benefits for contractors and gig workers that required no employer verification.
In that environment, crooks were easily able to impersonate jobless Americans using stolen identity information for sale in bulk in the dark corners of the internet. The data — birthdates, Social Security numbers, addresses and other private information — have accumulated online for years through huge data breaches, including hacks of Yahoo, LinkedIn, Facebook, Marriott and Experian. […]
In some cases, overseas organized crime groups flooded state unemployment systems with bogus online claims, overwhelming antiquated computer software benefits in blunt-force attacks that siphoned out millions of dollars. On several occasions, states have had to suspend benefit payments while they tried to figure out what was real and what was not.
“It’s definitely an economic attack on the United States,” said FBI Deputy Assistant Director Jay Greenberg, who is investigating cases as part of the Justice Department’s Covid fraud task force. “Tens of billions of dollars will be missing. … It’s a significant amount of money that’s gone overseas.” […]
The investigative journalism site ProPublica calculated last month that from March to December 2020, the number of jobless claims added up to about two-thirds of the country’s labor force, when the actual unemployment rate was 23 percent. Although some people lose jobs more than once in a given year, that alone could not account for the vast disparity. […]
“The states have been chronically underfunded for years — they’re running 1980s technology,” Hall said. […]
The inspector general has projected that there will be $87 billion in misspent unemployment funds, a conservative estimate that assumes no spike in fraud rates. Both the inspector general and the FBI declined to offer an estimate of what the actual value of lost funds might be.
ID.me’s estimate of $400 billion comes from the data the company has seen across the states, Hall said.
Illinois alone has at least a $5 billion deficit in its unemployment insurance trust fund. The feds need to help before insurance rates skyrocket.
posted by Rich Miller
Monday, Aug 16, 21 @ 1:27 pm
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While we’re talking about “huge data breaches” let’s not forget about my favorite one:
https://en.wikipedia.org/wiki/Office_of_Personnel_Management_data_breach
Comment by Candy Dogood Monday, Aug 16, 21 @ 1:38 pm
Funding IDES and bringing its technology up-to-date isn’t a priority. So when IDES is overwhelmed with applications, it’s too late. Sad story of so much wrong with government.
Comment by Sir Reel Monday, Aug 16, 21 @ 1:43 pm
Are the unemployment offices open yet ?
Comment by Simple Citizen Monday, Aug 16, 21 @ 1:49 pm
Feds need to help before insurance rates skyrocket?
Maybe Illinois can help itself by joining the other 47 states who have instituted a “look for work requirement” to collect unemployment benefits.
“Within the past couple months, pretty much every state has brought back its work-search requirements,” according to Alexa Tapia, an unemployment insurance campaign coordinator at the National Employment Law Project.
Only Illinois, New Jersey and Washington, D.C., haven’t yet done so, according to ZipRecruiter data available through June 18.
However, New Jersey plans to return to its pre-pandemic work-search requirement on Sept. 4, when the expanded federal benefits expire in the state, according to Angela Delli-Santi, a spokeswoman for the state Department of Labor.
Spokespeople at the Illinois and D.C. labor bureaus couldn’t be reached for comment.
https://www.cnbc.com/2021/08/04/collecting-unemployment-most-states-re-impose-work-search-rules.html
Comment by Lucky Pierre Monday, Aug 16, 21 @ 2:25 pm
Once the dust finally settles on this, I’ll be interested in two numbers: How much money Illinois lost to unemployment fraud, and how much money it would have taken to ensure IDES’ security was up to snuff.
Comment by Panther Pride Monday, Aug 16, 21 @ 2:29 pm
Attorney General Merrick Garland will root out this corruption and recoup the losses suffer by the American tax payers. Thank you in in advance.
Comment by Frumpy White Guy Monday, Aug 16, 21 @ 2:37 pm
Thanks Deloitte!
Comment by BTO3 Monday, Aug 16, 21 @ 2:52 pm
===a “look for work requirement”===
Couple/tree weeks away.
Comment by Rich Miller Monday, Aug 16, 21 @ 3:16 pm
- Lucky Pierre - is also the same bloke who championed fear as a motivator for labor, I can dig that up for ya if you wanna play “I never said that” baloney.
To the post,
Dunno how work search requirements would help the 1980s technology that was manipulated by a global type syndicate, but if you hate on working properly it’s on brand.
The feds are going to need to step in when federal law enforcement sees this type of crime as a threat to the country, am economic one at that.
Comment by Oswego Willy Monday, Aug 16, 21 @ 3:21 pm
Coincidentally, I *just* got a text message with a link to a phony link to “reactivate” my unemployment claim.
Comment by Ben Tre Monday, Aug 16, 21 @ 3:36 pm
See what happens when all the fraudsters got locked down at home, with nothing better to do?
Thanks Governor Pritzker. S/
Comment by Bruce( no not him) Monday, Aug 16, 21 @ 4:03 pm
‘overwhelming antiquated computer software’. Odd, I thought Deloitte and other IT wizards were hard at work updating the state’s computer systems. Must have misread the articles. Cobol programming still in place? A $5B deficit would be serious motivation to upgrade.
Comment by zatoichi Monday, Aug 16, 21 @ 4:07 pm
How has Pritzker not made this a priority yet. If there was a competent opponent to worry about, maybe he would take this more seriously.
Comment by Chicagonk Monday, Aug 16, 21 @ 4:10 pm
===How has Pritzker not made this a priority yet===
I dunno. If the Secret Service and the FBI can’t stop ‘em…
Comment by Rich Miller Monday, Aug 16, 21 @ 4:12 pm
=== If the Secret Service and the FBI can’t stop ‘em…===
The priority now for all the states facing billions of losses should be a federal relief response as all work for safety and security, so far unattained.
Comment by Oswego Willy Monday, Aug 16, 21 @ 4:15 pm
I thought Rauner was updating all of the state’s computer systems when he was governor. What happened to all of the money for the updated computer systems?
Comment by Mama Monday, Aug 16, 21 @ 4:39 pm
The Scammers were keeping the real unemployed workers from accessing the computer system to sign up for unemployment benefits.
Comment by Mama Monday, Aug 16, 21 @ 4:41 pm
===How has Pritzker not made this a priority yet=== Read the whole story.
This type of scam is something only the FBI and Homeland Security can fix. The scamming networks are so huge, I’m not sure the FBI can fix the whole scamming issues.
Comment by M Monday, Aug 16, 21 @ 4:48 pm
The return of work search can and should be talked about. It’s a completely different issue than fraud though.
Comment by Advocate Monday, Aug 16, 21 @ 5:02 pm
The feds have already given Illinois billions of dollars. And contrary to the Governor’s lie (he knew bette), they specifically allow it to be used for UI trust funds. Dozens of states have already done so and Illinois should follow suit.
The problem is that it’s not “politically sexy” unlike all of the press conferences that he’s doing when announcing grants. Sometimes its about governing and doing the right thing - not the politically expedient one.
Comment by 4 percent Monday, Aug 16, 21 @ 5:05 pm