Hundreds of Homeland Security employees were paid unemployment benefits during the coronavirus pandemic despite staying on the job, the department’s inspector general revealed Thursday.
Even worse, the Department of Homeland Security paid some of the money itself under an emergency unemployment program that the Trump administration “hastily” created in 2020, investigators said. That meant the department was making bogus payments to its employees.
The audit is the latest to ding the federal government over its reckless pace of pandemic spending. Uncle Sam spat out $3 trillion in just four months as the spread of COVID-19 sent the country into shutdown mode.
The Homeland Security inspector general identified nearly 2,400 claims from department employees and found about 600 of them were clearly eligible. Roughly 900 others were deemed “potentially” ineligible, and the remaining 900 or so were definitely ineligible, the inspector general said.
Some may have been cases of identity fraud, with someone filing a bogus claim in the name of an unsuspecting employee. Other cases appear to be old-fashioned double-dipping.
Nearly three dozen employees even filed unemployment claims from Homeland Security computer systems, suggesting they were on the job at the exact time they were claiming unemployment.
In 366 cases, pay records showed that employees received unemployment benefits even though they were not just working but also putting in overtime or extra shifts. One employee averaged 147 hours of work per two-week pay period while the department was also paying unemployment.
Sen. Rob Portman of Ohio, the top Republican on the Homeland Security and Governmental Affairs Committee, said he was “alarmed” by the findings.
“If these allegations are correct, those in charge of protecting our homeland were exploiting it for personal gain,” he said.
He asked the Justice Department to pursue action against any employees who were double-dipping.
Federal prosecutors brought hundreds of pandemic unemployment fraud cases, though they focused on people who stole large numbers of identities and filed claims using those names.
Estimates of unemployment fraud run to more than $200 billion, out of nearly $800 billion spent.
Much of that was orchestrated by “organized crime rings,” the inspector general said.
Fraud also struck the government’s loan programs at the Small Business Administration. The Paycheck Protection Program and Economic Injury Disaster Loans totaled $1.35 trillion, according to the Committee for a Responsible Federal Budget’s COVID-19 money tracker.
In a report released Thursday, the SBA inspector general reported that the agency made Economic Injury Disaster Loan payments to companies that didn’t exist before the pandemic started — a violation of the rules.
The SBA said it would review the applications that the audit flagged and would refer cases for investigation and prosecution.
The Homeland Security inspector general’s report focused specifically on an emergency unemployment program that the Trump administration created at the Federal Emergency Management Agency in the summer of 2020.
Congress created a $600-a-week additional unemployment benefit at the start of the pandemic. Lawmakers couldn’t agree on an extension, so the administration used disaster money at FEMA to add six weeks of benefits at either $300 or $400 a week.
Like the main unemployment program, the federal money went to states’ workforce agencies, which distributed the payments.
Like the main pandemic unemployment program, the FEMA program was rife with fraud, the inspector general concluded. In a report this month, investigators identified roughly 10% of the FEMA unemployment money that showed signs of improper payments.
Thursday’s report put a fine point on the matter. Investigators found problems inside Homeland Security, which oversees FEMA.
The audit said “FEMA overly relied” on the existing unemployment system, which had serious weaknesses. FEMA also didn’t require states to impose critical fraud checks before spending the money.
Roughly 770 employees at the Transportation Security Administration received unemployment benefits, but only about 150 were deemed clearly eligible.
At FEMA, more than 1,100 employees were paid. Just 400 of those claims were deemed clearly eligible, and 111 of those were probably fraudulent.
All told, the department paid $2.6 million in disaster unemployment benefits to employees who weren’t clearly eligible.
Jim H. Crumpacker, Homeland Security’s liaison to the inspector general, said in an official reply to the report that FEMA had to rush to create the emergency unemployment program in August 2020 and made its first payment just six days after President Trump established the program.
Mr. Crumpacker said the inspector general ignored anti-fraud efforts at the department.
The inspector general said those were implemented too late.
“FEMA’s policies did not require [state workforce agencies] to implement controls to prevent fraud from occurring; instead, they focused on detecting fraud after the fraudulent activity already occurred,” the audit said.
For more information, visit The Washington Times COVID-19 resource page.