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GAO-24-107471 1 (2024-07-23)

handle is hein.gao/gaoqpn0001 and id is 1 raw text is: Why This Matters Key Takeaways Fraud poses a significant risk to the integrity of federal programs and erodes public trust in government. The unemployment insurance (UI) system has faced long-standing challenges with effective service delivery and program integrity, which worsened during the COVID-19 pandemic because of historic levels of job loss, among other reasons. As a result of these long-standing challenges, in June 2022 we designated the UI system as a high-risk area. The Department of Labor (DOL) oversees UI, and states design and administer their own UI programs within federal parameters. The CARES Act, enacted in March 2020, created three new federally funded temporary UI programs that expanded UI benefit eligibility, enhanced benefits, and extended benefit duration. One of these was the Pandemic Unemployment Assistance (PUA) program. The unprecedented demand for UI benefits and the need to quickly implement the new programs increased the risk of fraud. In February 2023, the Comptroller General of the United States testified before the Committee on Ways and Means of the U.S. House of Representatives that DOL and the states were not adequately prepared to handle UI fraud risks when the pandemic began. In March 2023, we were asked to continue our work to develop a comprehensive estimate of UI fraud during the pandemic and address DOL and states' efforts for identifying and recovering UI overpayments. In September 2023, we estimated that the amount lost to fraud in DOL's UI programs during the pandemic-from April 2020 through May 2023-was likely between $100 billion and $135 billion. Additionally, our analysis found higher fraud rates for PUA payments than for other UI program payments. In this report, we provide additional information on the controls that states used to prevent and detect fraud in their PUA programs. * States faced challenges in rapidly implementing their new PUA programs and in establishing effective antifraud controls in response to the unprecedented unemployment caused by the COVID-19 pandemic. * The controls used by states to manage fraud risk varied but, in general, all states within our review increased the variety of controls used in their PUA programs as the pandemic progressed. Sometimes states added new controls in response to the availability of new resources or after identifying program vulnerabilities. * State officials we spoke with from 14 selected states said that implementing new controls, or expanding existing controls, helped them to address fraud risks they identified in their state's PUA program. * A key lesson learned is that failing to apply a new control to previously approved continuing claims may leave a state vulnerable to fraud and lessen the efficacy of the control at mitigating fraud risk in the program. Page 1 GAO-24-1 07471 Pandemic Unemployment Assistance Page 1 GAO-24-107471 Pandernic Unemployment Assistance

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