Maryland Governor Larry Hogan announced Wednesday that state officials had uncovered a massive fraudulent scheme involving 47,500 counterfeit unemployment insurance claims, totaling more than $ 501 million.
The scheme involved identity theft from previous security breaches and suggested that any personal information submitted in legitimate claims had been compromised in any way.
“This criminal enterprise seeking to take advantage of a global pandemic to steal hundreds of millions, perhaps billions, of taxpayer dollars is negligible,” Hogan said at a press conference on Wednesday.
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The governor said the fraud was detected when state employees with the unemployment insurance website noticed an unusual increase in the number of claims that were filed out of state, prompting an investigation and eventually notified federal authorities.
Maryland Department of Labor Secretary Tiffany Robinson noted that the unusual activity occurred on July 4.
“Obviously it’s a coordinated criminal enterprise because it’s not just about random people in your basement who stole someone’s identity,” Hogan told reporters.
Robinson said they were able to save taxpayers “hundreds of millions of dollars” by catching the scheme quickly due to the strictest security measures.
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“We will continue to work with our state and federal partners to prevent scammers from taking advantage of the difficulties caused by the coronavirus during these already difficult and uncertain times,” he added.
Hogan noted that some “real” people froze their accounts and that the Department of Labor would work quickly to get their payments.
Derek Pickle, acting special agent in charge of the Office of the Inspector General of the United States Department of Labor, said the nation was seeing a significant increase in unemployment insurance fraud since Congress passed the first stimulus package. 12 states are estimated to have seen similar fraud schemes.
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“To give you an idea of how that peak corresponds to our work, unemployment insurance fraud investigations have historically constituted approximately 10 percent of our agency’s investigative workload,” Pickle said at the news conference. Wednesday.
“Today more than 50 percent of our research issues belong to unemployment insurance and that number continues to grow day by day and that includes research issues in all 50 states.”
State and federal offices coordinate together to locate and prevent fraudulent claims, although Hogan said they did not yet know whether the criminals were based in the United States or abroad.
