Pritzker administration failed to report unemployment fraud data

Pritzker administration failed to report unemployment fraud data

A U.S. Department of Labor report stated Illinois failed to report theft of pandemic relief money as required. Illinois lost over half of pandemic unemployment funds to fraud.

The U.S. Department of Labor criticized Illinois for failing to report data on fraudulent pandemic unemployment payments, stating future fraud is hard to prevent when past fraud isn’t tracked.

Illinois lost over half of its pandemic unemployment funds to fraud, according to a state audit.

“Without accurate state performance information, Congress and the [Employment and Training Administration] are not able to fully assess state activities and mitigate the risk of overpayments and fraud for future programs of a similar nature,” the report stated.

A separate report from Illinois Auditor General Frank Mautino found about $1.9 billion of the $3.6 billion distributed from July 2020 to June 2021 was paid to illegitimate accounts.

Online chat rooms offered tutorials on how to scheme Illinois’ unemployment benefits through identity theft, according to David Maimon, criminology professor at Georgia State University.

“We see many identities, many bank accounts, many driver’s licenses that are associated with Illinois residents” for sale on the dark web, Maimon said.

State administrators said they’ve updated their software to improve security. The Illinois General Assembly additionally passed two new laws Aug. 5 extending the statute of limitations for prosecuting fraudulent stimulus loans and identify theft.

Haywood Talcove, CEO of LexisNexis Risk Solutions, said there’s still a danger even with the new protections in place.

“They’re claiming it’s fixed, and I’m telling you, it’s not fixed,” Talcove said.

One of the major funds for those out of work was Pandemic Emergency Unemployment Compensation. Illinois was one of four states that didn’t report required PEUC overpayments for any quarter from March 2020 through September 2021.

IDES officials blamed the fraudulent payments on a lack of proper guidance from the federal government. An early investigation by the Chicago Tribune showed the fraud in Illinois was exacerbated by IDES failing to follow federal recommendations or adopt free fraud-fighting tools.

IDES faced a litany of problems handling the pandemic, including an unemployment website making it easy for identity thieves when it exposed Social Security numbers and other personal information of 32,483 Illinois unemployment applicants after it first went online. Applicants faced months of delays in receiving benefits and more than 200,000 claimants at one point were awaiting a call about their benefits.

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