Question for Biden: Were Half of U.S. Unemployment Benefits Stolen?

Question for Biden: Were Half of U.S. Unemployment Benefits Stolen?

If true, this would represent one of the biggest corruption scandals in U.S. history, and also a huge security breach.

A piece by Axios, published on Thursday, made a wild, eye-opening claim: That as much of half of the unemployment money paid out by the government during the pandemic, to the tune of $400 billion, may have been stolen. Much of that money, per Axios, that was meant for struggling Americans may in fact have ended up in the hands of foreign crime syndicates.

If true, this would represent one of the biggest corruption scandals in U.S. history, and also a huge security breach. Politically, it may also have massive implications on the distribution of future money. After all, how can the political will be mustered to pass aid packages in the future, when opponents can claim that hundreds of billions of dollars were stolen, the last time it happened? Some politicians, including Gov. Larry Hogan of Maryland, have even shared the Axios article on social media.

However, it appears the claims in the Axios piece are very, very thin.

To start off, the sources of those claims are not the government or any type of independent investigation. There’s not been a criminal indictment of any of those crime syndicates, laying out exactly what money they stole and how they did it.

Instead, the piece quotes the CEO of, a company that specializes in selling security solutions to businesses and governments, as well as the CEO of LexisNexis Risk Solutions. The former states that America lost “more than $400 billion” to fraudulent unemployment claims, while the latter states that “at least seventy percent of the money stolen by impostors ultimately left the country,” with the money ending up in the hands of state-owned entities in such countries as China, Nigeria, and Russia. “Street gangs” have also been responsible for some of the theft, according to LexisNexis Risk Solutions.

The Treasury Department did not comment when Axios reached out. Axios wasn’t clear about how much of the money in question was from the CARES Act and how much was from the American Rescue Plan Act; both distributed unemployment funds to states. and LexisNexis Risk Solutions, as some early critics of the story have pointed out, are both companies that stand to benefit from government contracts related to security, especially after a piece like this appears in Axios, a publication aimed at powerful people in Washington.

The story also lays out some of the methods criminals are using to steal unemployment money, including scammers stealing identities and claiming benefits under those identities. This led to unemployment fraud being offered on the black market as “on a software-as-a-service basis.”

There’s little doubt that criminals really are doing those things, and really are stealing money that is being distributed as unemployment benefits, and that this is taking place really is a problem. But the claims that this is being done to the tune of $400 billion, or that it has scooped off half of the unemployment benefits distributed in the country since last year, remain very much unsupported.

A report earlier this year from the trade publication FCW, which cited an inspector general memo in the Department of Labor, found that “over $5.4 billion was paid to potentially fraudulent unemployment claims between March and October of 2020.” That’s a lot of money, but it’s well short of $400 billion. A CNBC report in January put the amount of unemployment benefits lost to “improper payments” at $36 billion, from the time the CARES Act was passed until the end of 2020.

Stephen Silver, a technology writer for The National Interest, is a journalist, essayist and film critic, who is also a contributor to The Philadelphia Inquirer, Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.

Image: Reuters