KDOL refers more than 50k cases to law enforcement as part of its fraud crackdown strategy

Local

TOPEKA, Kan. (KSNW) – The Kansas Department of Labor released accumulated data breaking down the number of fraud attempts, the estimated amount of fraud payments paid out, and law enforcement referrals on Tuesday.

Following an in-depth analysis and IRS Form 1099-G reconciliation, KDOL has determined that from Jan. 1, 2020, through Dec. 31, 2020, about $140 million in fraudulent claim payments were made from the Kansas regular unemployment insurance program.

Additionally, more than $150 million in fraudulent payments are attributed to federal benefits programs, for a total of $290 million. 

USDOL-OIG estimates that unemployment fraud has cost taxpayers roughly $36 billion nationwide since the start of the pandemic. The total amount of potential fraud is roughly eleven percent of total unemployment insurance payouts since the start of the pandemic. 

Other states to have publicly shared their fraud numbers include:

As part of a robust anti-fraud effort the agency has referred over 50,300 cases of alleged fraud to federal law enforcement partners for investigation and possible criminal prosecution, and is actively working with the Federal Bureau of Investigation, U.S. Secret Service, U.S. Department of Labor’s Office of Inspector General (USDOL-OIG) and the U.S. Attorney’s office to hold fraudsters to account. 

In early February, KDOL implemented a new fraud mitigation software solution that has drastically reduced the number of fraudulent claims that have been filed. Since its launch, this system has stopped more than 4.8 million bot attacks and fraudulent login attempts. As a result, KDOL’s fraud team has been able to focus its efforts on more sophisticated cases and investigations.

Since the beginning of 2020, KDOL stopped approximately 500,000 fraudulent claims that were the result of identity theft and other unemployment related fraud that could have cost more than $22 billion. These stopped claims are the result of many hours of effort from the KDOL fraud team who have worked tirelessly to combat sophisticated criminal rings, which have targeted the state’s unemployment system. The number also includes identity theft cases that have been reported by individuals and businesses. 

Since March 15, 2020, KDOL has paid out over 4 million weekly claims totaling over $2.7 billion between regular unemployment and the federal pandemic programs. 

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