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From direct stimulus payments to unemployment benefits, Americans have received a range of different forms of financial aid during the pandemic. But a large chunk of that aid — as much as 50% — may not have made it into the hands of the right people.
Axios reported on Thursday that unemployment fraud has been on the rise during the pandemic, with Blake Hall, the CEO of ID.me, a fraud prevention service, telling the news service that America has lost $400 billion to fraudulent claims and that as much as 50% of unemployment claims might have been stolen. The CEO of LexisNexis Risk Solutions’ Government business, Haywood Talcove, also told Axios that at least 70% of stolen money ultimately left the country, with much of it ending up in places including Chin and Nigeria.
“These groups are definitely backed by the state,” Talcove said.
This is not the first reported instance of stimulus money ending up in the wrong hands. Last week, federal authorities announced that Venezuelans living in South Florida and Mexico had stolen over $800,000 in stimulus checks since the start of the pandemic.
And on May 28, the Office of the Inspector General (OIG) found that $39 billion in unemployment money from the CARES Act had been wasted, partly due to failures in detecting fraud and improper payments.
So how are scammers managing to carry out this fraud?
Axios reported that they often steal people’s personal information to withdraw money, and “mules,” or low-level criminals, are given debit cards to withdraw that money from ATMs, which then gets transferred abroad.
Given that some Democrats are pushing for recurring stimulus payments and unemployment benefits beyond what has already been delivered, fraud is something that will need to be addressed before moving forward. The OIG recommended more modernized technology to better detect …read more