State unemployment fraud cases top 120K
SPRINGFIELD – The state has identified more than 120,000 instances of fraud in its unemployment system since March, approximately 114,000 of which targeted the federal Pandemic Unemployment Assistance program that has been ripe for exploitation nationwide, according to the FBI.
That program, passed by Congress as part of COVID-19 relief efforts, allows independent contractors and others to apply for unemployment benefits they would otherwise not be entitled to. The program launched in Illinois in May.
Gov. J.B. Pritzker said at a COVID-19 update in Chicago Wednesday the federal program was “poorly designed,” and fraud calls have exacerbated issues state unemployment systems are already having in processing claims.
“This is a brand new program that the federal government rushed to develop, and then left each state to create its own separate system,” Pritzker said. “As a result, there were massive holes for illegal fraudsters to steal federal dollars from taxpayers across the country.”
He said the state has been asked to cooperate with federal investigators, and noted that anyone that has not applied for unemployment benefits but receives either a debit card or correspondence from the Illinois Department of Employment Security should report it.
“In addition to working with law enforcement, IDES is also taking every action to track down and cut off fraudulent claims, reviewing flagged files to identify commonalities and patterns,” Pritzker said. “The highly experienced money launderers who have perpetrated these crimes use the same payment methods that regular filers do. For that reason, the IDES can’t simply cut off common dispersal mechanisms that also serve as lifelines for innocent users.”
Pritzker said IDES has processed more than 2 million total claims in 2020, so the number of fraudulent claims “pales in comparison to the number of Illinoisans in genuine need of assistance.”
Fraud can be reported at IDES.illinois.gov, and those reporting will be called back in the order of submission.
Pritzker made the announcement as unemployment remained at an unprecedented high level in Illinois, where the June unemployment rate was 14.6 percent due to the pandemic and associated economic turmoil.
Pritzker once again warned that further restrictions on businesses and public activity may be needed if transmission of the virus remains on the upward trend that it has seen in recent weeks.
The state reported another 1,759 new cases of the virus Wednesday among 46,668 test results reported over the previous 24 hours. That made for a one-day positivity rate of 3.8 percent as the seven-day rolling average positivity rate remained at 3.9 percent.