Kansas turns over 50,000 fake unemployment claims to federal investigators

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TOPEKA, Kan. — The Kansas Department of Labor has referred more than 50,000 cases of fraud to investigators, and stopped payments on another 500,000 cases. Those are just cases from January 1, 2020 through December 31, 2020.

The Kansas Department of Labor also said the Kansas unemployment insurance program paid about $140 million to fraudulent claims in 2020. That doesn’t include another $150 million in fraudulent payments through federal benefits programs.

The numbers were released Tuesday following an analysis of tax forms.

The U.S. Department of Labor estimates that unemployment fraud has cost taxpayers roughly $36 billion nationwide since the start of the pandemic. The total amount of potential fraud is roughly eleven percent of total unemployment insurance payouts since the start of the pandemic. 

“Fraud is unacceptable and will not be tolerated. It’s stealing from taxpayers at the worst possible time and all attempts at fraud will be referred in the strongest possible manner to law enforcement,” Gov. Laura Kelly said. 

“All 50 states have been overrun with coordinated, sophisticated criminal fraud attempts, and that’s why I wrote a letter with fellow governors, calling on Congress to provide funding to secure and modernize our systems.”

Agents with the FBI, Secret Service and U.S. Attorney’s office are now looking into the fake unemployment claims to determine if there is enough evidence to prosecute.

Since the beginning of 2020, KDOL stopped approximately 500,000 fraudulent claims that were the result of identity theft and other unemployment related fraud that could have cost more than $22 billion.

These stopped claims are the result of many hours of effort from the KDOL fraud team who have worked tirelessly to combat sophisticated criminal rings, which have targeted the state’s unemployment system. The number also includes identity theft cases that have been reported by individuals and businesses. 

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