A recent Department of Government Efficiency (DOGE) report has identified $382 million in fraudulent unemployment payments since 2020, with California, New York, and Massachusetts accounting for nearly $305 million in ineligible claims over the four-year period.
The report highlights particular concerns about California’s unemployment system, which allegedly processed benefits for individuals on federal watchlists, including some with criminal records or potential terrorism ties. DOGE officials noted these payments occurred under previous federal administration policies.
All three states mentioned in the report currently operate under unified Democratic control, holding both legislative majorities and governorships. The findings come as Congress debates reforms to unemployment verification systems and funding allocations.
DOGE investigators emphasized that while fraud occurred nationwide, these states represented disproportionate shares of improper payments. The report did not specify whether the overpayments resulted from systemic failures, inadequate oversight, or intentional fraud schemes.
State officials from California, New York and Massachusetts have not yet issued formal responses to the audit findings. The report recommends enhanced verification measures and closer federal-state coordination to prevent future improper payments.
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