Hogan: $501M worth of fraudulent unemployment claims filed in Md.

In what Maryland Gov. Larry Hogan described as a “massive, sophisticated criminal enterprise,” scammers attempted to use stolen identities to submit fraudulent unemployment claims worth around $501 million from the state’s unemployment insurance system.

In a Wednesday news conference, Hogan said over 47,500 fraudulent claims were submitted to Maryland’s unemployment website in an attempt to exploit the massive spike of residents seeking assistance after losing their jobs as a result of the coronavirus pandemic.

The governor said the state’s unemployment website detected a high number of out-of-state claims coming in, which was then reported to federal authorities.

“The state of Maryland, exposing this illegal scheme and notifying the authorities, has helped shed light on related fraudulent criminal activities in at least a dozen other states,” Hogan said.

Maryland’s Department of Labor, working with agents from the U.S. Department of Labor’s Office of the Inspector General, was made aware of the fraudulent claims while they were still in the review process and the claims were not paid out, said state Labor Secretary Tiffany Robinson.

The scammers used the identities of Marylanders stolen during earlier data breaches to file the claims on the state’s unemployment website, according to Hogan.

The federal CARES Act, which was passed by Congress to provide economic aid during the early days of the pandemic, contained a provision that allowed those filing for unemployment to self-certify their unemployed status, as opposed to receiving a certification from their previous employer.

This was done in order to speed up the claims process while the U.S. was facing unprecedented levels of unemployment, but Robinson said the scammers took advantage of the situation to submit their false claims.

So far, over 489,000 Marylanders have received some form of unemployment assistance during the course of the pandemic for a total of $4.3 billion, Hogan said.

Maryland’s unemployment insurance system faced strong criticisms after struggling to meet the surge of people who found themselves out of work as a result of pandemic-related shutdowns.

Some advocated for paying out the claims of people who were caught in the backlog of the system, which Robinson pushed back on.

Hogan defended that decision Wednesday amid the revelation of the coordinated efforts to scam states’ unemployment systems.

“Some had suggested that we compromise the integrity of these federal programs and that we just pay out benefits regardless of whether it is a legal claim, or whether or not an individual is eligible,” Hogan said. “That would have violated state and federal law and it would exploit innocent taxpayers.”

Zeke Hartner

Zeke Hartner is a digital writer/editor who has been with WTOP since 2017. He is a graduate of North Carolina State University’s Political Science program and an avid news junkie.

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