It has been over two months since the statute of limitations to prosecute criminals who stole billions in COVID-era unemployment insurance (UI) benefits began to expire, forcing law enforcement to abandon ongoing fraud investigations.
In March, the U.S. House of Representatives overwhelmingly passed the bipartisan Pandemic Unemployment Fraud Enforcement Act (H.R. 1156) to extend the statute from 5 to 10 years and give law enforcement more time to go after fraudsters and recover taxpayer dollars. The U.S. government estimates as much as $135 billion in UI benefits were stolen from American taxpayers during the pandemic; and yet, to date, the U.S. Senate has not taken action. As the months continue to pass, more and more criminals will be let off the hook to continue to use false identities to intentionally target government programs and divert public funds away from vulnerable workers and families.
Ways and Means Committee Chairman Jason Smith (MO-08) released the following statement calling on the Senate to act on the bipartisan, House-passed legislation as soon as possible:
“Every day the Senate delays action on extending the statute of limitations to prosecute this UI fraud is another day criminals are getting away with what is considered the greatest theft of tax dollars in U.S. history. The fraud perpetrated under the UI program is not yesterday’s news. Some estimates put the amount of dollars stolen as high as $400 billion. The Department of Justice has well over 1,000 cases currently open, and the Department of Labor’s Inspector General has already identified cases that it will be unable to prosecute because of the expiring statute while law enforcement agencies have been forced to abandon or forgo prosecution of criminals who stole billions in taxpayer funds. The House-passed Pandemic Unemployment Fraud Enforcement Act is a simple, sensible, and strongly bipartisan solution that will arm our law enforcement with the time they need to not only go after existing criminals but also signal to would-be future fraudsters that the U.S. government will not look the other way when the American taxpayer is being robbed.”
In response to a request by the Committee, the Department of Labor Inspector General’s Office identified a number of fraud investigations involving millions of tax dollars that have been or will be jeopardized in the coming months due to expiring statute of limitations if the Senate fails to act:
- The National Unemployment Insurance Fraud Taskforce has identified several criminals who submitted fraudulent unemployment claims totaling over $3.1 million across multiple states and territories including California, Kansas, Maryland, Arizona, Illinois, Massachusetts, and Guam. The statute of limitations on this case begins to expire in September 2025.
- An investigation, which identified approximately $1 million in UI fraud, involved the mailing of several dozen UI claims to the same address. The statute of limitations began to expire in May 2025.
- An investigation, which identified approximately $1 million in UI fraud, involved the use of the names of two companies to submit around 100 UI claims. The statute of limitations began to expire in May 2025.
- An investigation, which identified approximately $1 million in UI fraud, involved at least nine conspirators and multiple claims filed in multiple states. They were also linked to about $8 million in Paycheck Protection Program and Economic Injury Disaster Loan Program fraud. The statute of limitations for UI fraud began to expire in May 2025.
- An investigation, which identified approximately $700,000 in UI fraud, involved in a nation-wide scheme to obtain pandemic UI benefits from multiple states including Arizona, California, Georgia, Nevada, Massachusetts, Michigan, and Guam. The investigation found the suspects used identities of persons who were ineligible for these benefits, such as incarcerated individuals. The statute of limitations begins to expire in December 2025.
- An investigation determined that 20 fraudsters, who were posing as assorted individuals during the ID verification process, submitted photographs and fake driver’s licenses in order to file UI claims. One individual claimed to be 177 different people to obtain pandemic UI funds from one state. The statute of limitations for several of these cases expired in March 2025.
- An investigation, which identified approximately $300,000 in UI fraud, involved an address associated with the mailing of several dozen UI debit cards, as well as UI claims using the personally identifiable information of more than 30 individuals. The Attorney General is unsure if she will be able to indict prior to the expiration of the statute of limitations.
- An investigation, which identified over $200,000 in UI fraud, revealed that a Social Security number was used to file more than 40 UI claims. The investigation also determined the alleged claimant had a previous criminal history. The statute of limitations begins to expire in October 2025.
Additional Background:
- A recent report from the Government Accountability Office, found that even five years after the pandemic, law enforcement has been successful in prosecuting pandemic-relief program fraud cases.
- At least 2,532 defendants have been found guilty of fraud-related charges involving pandemic-relief programs, as of December 31, 2024.
- Criminals sentenced faced serious consequences, including prison time and restitution orders that resulted in large financial settlements.
- According to the Department of Justice (DOJ), from March 2020 to December 31, 2024, it secured more than 650 civil settlements and judgments, totaling more than $500 million, to resolve allegations of fraud or overpayments in connection with the pandemic relief programs.
- Notably, these prosecutions have increased year-over-year since the beginning of the pandemic, and DOJ has stated that trend is expected to increase for the foreseeable future – further justification for extending the statute of limitations to allow the government continued access to one of its primary antifraud and recovery tools.
Pandemic Unemployment Fraud Enforcement Act (H.R. 1156)
Extends the statute of limitations for prosecuting COVID-era unemployment insurance (UI) fraud from five to 10 years.
- Government estimates show as much as $100-$135 billion in UI benefits were lost to fraud during the pandemic. Only $5 billion has been recovered, or less than 4 percent.
- The Department of Justice has 1,648 open, uncharged COVID-19 criminal matters and the Labor Department has reported 157,000 open UI fraud hotline complaints. Failure to extend the statute of limitations will result in criminals going unpunished and forgoing recovery of billions in taxpayer dollars.
- In 2022, on a bipartisan basis, Congress similarly extended the statute of limitations for prosecuting fraud in the Paycheck Protection Program and Economic Injury and Disaster Loans to 10 years.
- The bill is supported by the National Association of State Workforce Agencies, a non-partisan association representing all 50 states administering the UI program.
Click here to read a fact sheet on the bill.
READ: House Passes Overwhelmingly Bipartisan Legislation to Empower Law Enforcement to Continue Prosecuting Pandemic Unemployment Fraud and Recoup Hundreds of Billions in Tax DollarsREAD: Chairman Smith: If Congress Doesn’t Extend Statute of Limitations, Criminals Will Get Away With Unemployment Insurance Fraud