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EXCLUSIVE: Rep. Bob Gibbs Has Major Questions Surrounding Fraudulent Unemployment Claims

   DailyWire.com
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Ohio Congressman Bob Gibbs (R) on Friday penned a letter to Department of Justice Inspector General Michael Horowitz asking for an investigation into widespread unemployment fraud that has taken place throughout the COVID-19 pandemic. Specifically, Gibbs wants to know if an anti-fraud detection program could have prevented states from spending millions — and in some cases, billions — on unemployment fraud.

According to Ohio Department of Job and Family Services (ODJFS) Interim Director Matt Damschroder, the state has paid out more than $2.1 billion in unemployment benefits since the COVID pandemic began last March. In addition, “More than 1.5 billion worth of overpayments were considered to be ‘nonfraudulent’ that affected both traditional and pandemic unemployment benefits,” WBNS-TV reported. “Fraudulent overpayments in both traditional and pandemic unemployment totaled more than $460 million.”

Ohio isn’t the only state that has dealt with sweeping unemployment fraud. California allegedly sent $1 billion in enhanced COVID unemployment benefits to “hundreds of incarcerated individuals, including high-profile convicted murderer Scott Peterson,” per a report from The Daily Wire.

In New Mexico, the state paid $250 million in overpayments, $100 million of which was fraud, KRQE-TV reported. The New York state government paid out $2 million in unemployment benefits to eight men who schemed the system, per a report from the New York Daily News. And in Texas, $577 million went to roughly 373,000 possibly fraudulent claims, KVUE-TV reported.

Congressman Gibbs wants to know if an anti-fraud detection program could have prevented large-scale fraud that took place throughout the pandemic.

“In 2013, the Obama administration gave California’s Employment Development Department (EDD) a $2 million grant to implement a fraud detection program through Pondera Solutions. This program is reported to be very successful at detecting high probability fraud in a large number of cases but was shut down in 2016 by EDD due to its annual operations cost of $2 million,” Gibbs wrote. “According to El Dorado County District Attorney Vern Pierson, a significant percentage of between $11 and $31 billion would have been saved in 2020 if the program would have still be running.”

Specifically, Gibbs wants the IG to determine:

  1. The amount of overpayments and fraudulent payments of each state.
  2. Which, if any, states implement programs similar to the California EDD using Pondera, and how effective were they at preventing fraud?
  3. Whether any states have conducted their own audits and what are the findings.
  4. The recovery rate of each state (IE-what states have done the vest in recouping fraudulent payments).
  5. Provide guidance on best practices for addressing the issue and preventing it from happening in the future. 

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The letter comes after House Ways and Means Committee Republicans, under the leadership of Rep. Kevin Brady (TX), introduced the Combatting COVID Unemployment Fraud Act of 2021, which would “prevent fraud in COVID unemployment programs, recover fraudulently paid benefits, and provide relief for taxpayers and victims of unemployment fraud,” a press release from the committee stated.

Senate Finance Committee Ranking Member Mike Crapo (R-ID) introduced a companion bill in the Senate, known as S. 1699.

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