Probe: Pennsylvania Paid $2.2 Billion in Fraudulent Unemployment Insurance

Conservatives have been trying for years to investigate fraud in welfare programs at the national and state levels. Repeatedly, we are told by the Left that such attempts are unnecessary and endanger the ability of those programs to help those in need. However, time and again, we see that there are examples of fraud in welfare programs across the country. The recent probe into fraudulent unemployment insurance claims proves this yet again. As the Washington Examiner reports, unemployment programs as a whole handed out $5.6 billion in improper benefits between the years of 2009 and 2013. Astoundingly, $2.2 billion of that came from Pennsylvania:

Pennsylvania paid out $2.2 billion dollars for apparently fraudulent claims for unemployment insurance between 2009-13, a recent report by the Labor Department’s Office of the Inspector General found. That total included $1.7 billion in improper payments that were not discovered by the state, and another $500 million that were detected but went unrecovered anyway.

In other words, the Keystone State was responsible for over two fifths of all improper unemployment payments being handed out. Meanwhile, here are the numbers from last year, along with an explanation of why these things happen:

Labor said the states with the highest rates for improper payments in 2014, all above 14 percent, are Indiana, Louisiana, Nevada, North Carolina, Maine and Nebraska. The states with the largest amounts of improper payments for that year were California ($389 million), Illinois ($354 million), Pennsylvania ($337 million) and New Jersey ($335 million).

The principle cause was people who had been receiving unemployment finding jobs without reporting that to the state, allowing the insurance payments to continue to flow. Others engage in outright fraud from the beginning either by not reporting earnings when they apply or by submitting fictitious names.

While Pennsylvania did not give out the most fraudulent payments last year, they were among the leaders doing so.

One of the things we should take note of here is that, in the numbers from 2009-2013, the state of Pennsylvania alone was aware of $500 million in unemployment insurance fraud, but failed to act to retrieve it. The state’s government knew of these cases, but decided not to act. As the article notes, it’s hard to combat unemployment insurance fraud, since people self-certify for the program. It’s impossible to eliminate all fraud and corruption, but that’s no excuse for trying to do so. With this $500 million, the state knew the payments were improper. This was an instance where they could have pursued action about those accepting the fraudulent payments, whether they did so knowingly or not, and chose not to. That is unacceptable at any level of government.

Numbers like these are only small in comparison to our national budget, but sums like these add up. That’s why it’s important to fight for accountability from the federal government over all instances of fraud like this. What I really want to know, though, is why did Pennsylvania hand out far and away more in improper payments than the other states? Was there some sort of racket going on? The article says that the Labor Department is working with the states to fix this problem, but I think it would be interesting for one or both of Congress’ Oversight Committees to investigate the issue as well.

Featured image via Ed Brown at <a href=””>Wikimedia Commons</a>.