The state of Maryland has concluded its initial review into a $501 million fraudulent unemployment claims scheme uncovered in July, and announced that it has identified more than 123,000 additional claims that are likely fraudulent.
The Department of Labor first revealed on July 15 that it had discovered a “massive and sophisticated criminal enterprise” that had filed tens of thousands of fraudulent Pandemic Unemployment Assistance Claims with the state. PUA claims are part of new federal program rolled out in May that provides unemployment coverage to independent contractors, gig workers, sole proprietors and other self-employed people. When Maryland discovered the fraud over the Fourth of July weekend, the state quickly froze all out-of-state accounts, which Gov. Larry Hogan said at the time prevented “the bulk” of fraudulent claims from being paid out.
On Thursday, the Department of Labor announced that out of the 48,280 out-of-state claims that were frozen, 94.8% were determined to be fraudulent. After the accounts were frozen, the state gave claimants the chance to upload additional documentation to their accounts to prove their claim was not fraudulent. Only 4,616 claimants uploaded documentation, and of those, 2,502 were approved and reinstated following a manual review. The remaining 2,114 claims were determined to be fraudulent and were denied, according to the release.
