The US House of Democrats passed a $1.9 trillion COVID-19 relief bill late last week. While a new round of unemployment aid is in the works, US state governments are preparing to update the security of their unemployment systems in a fight against scams.
As AP reports, many states are not prepared to protect their systems from the onslaught of scams in which fraudsters from around the world have already obtained billions of dollars from pandemic jobless aid programs.
The Labor Department inspector general’s office estimates as much as 10 percent of the total unemployment payments given through pandemic programs have been improperly given out due to fraudsters. That amounts to $63 billion.
The scams lead to delayed unemployment payments and thousands of Americans’ identities stolen.
Fraudsters from countries like China, Nigeria, and Russia buy stolen personal information online and then use it to claim aid on state unemployment systems. This personal information comes from previous identity thefts in which hackers stole data from banks, credit rating agencies, health care systems, and retailers and put it up online for sale.
The people whose information is being used to file these fraudulent unemployment claims only find out that their data has been stolen when their tax statements come.
Rep. Kevin Brady, the ranking member of the House Ways and Means Committee, said to AP that the estimated amount that has been stolen is “larger than the entire budget of the Department of Homeland Security.”
The US Department of Justice has arrested multiple people who reaped millions of dollars by filing fraudulent aid claims, but many of the scammers live abroad in countries like China and Russia and are out of reach and hardly ever will face US justice.