{"id":15783,"date":"2026-06-17T18:32:23","date_gmt":"2026-06-17T18:32:23","guid":{"rendered":"https:\/\/siliconvalleymovingpost.com\/?p=15783"},"modified":"2026-06-17T18:32:23","modified_gmt":"2026-06-17T18:32:23","slug":"us-tells-states-to-deal-with-unemployment-fraud-or-face-penalties","status":"publish","type":"post","link":"https:\/\/siliconvalleymovingpost.com\/?p=15783","title":{"rendered":"US tells states to deal with unemployment fraud \u2014 or face penalties"},"content":{"rendered":"
\n

By GEOFF MULVIHILL<\/strong><\/p>\n

The U.S. Department of Labor told states Wednesday to take immediate action to combat fraud, waste and abuse in their unemployment insurance programs \u2014 and that they could have administrative funds withheld if they don\u2019t comply.<\/p>\n

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The letters, which went to the governors of every state, are the latest in a series of actions from President Donald Trump\u2019s administration focused on fraud, waste and abuse in state-run programs that include federal funding. Like with most of the other similar announcements, the administration focused on issues in states where Democrats control the government.<\/p>\n

\u201cWe are officially putting governors on notice,\u201d Acting Labor Secretary Keith Sonderling said in a statement Wednesday. \u201cThe American people will no longer tolerate the blatant waste, fraud, and abuse of their hard-earned tax dollars \u2014 no state should allow it either. If states allow it, they will suffer the consequences.\u201d<\/p>\n

Labor Department offers few details<\/h4>\n

The Labor Department said Wednesday that poor oversight, outdated technology, weak identity verification and lax controls have \u201callowed unprecedented fraud to flourish.\u201d<\/p>\n

In its announcement, it cited problems in California, Illinois and New York \u2014 three states where Democrats control the governments.<\/p>\n

California Gov. Gavin Newsom\u2019s office blasted the move and criticized \u201clax regulations and rushed distribution\u201d of unemployment benefits by the first Trump administration during the COVID-19 pandemic.<\/p>\n

\u201cMeanwhile California outperforms other states in addressing fraud,\u201d Newsom spokesperson Marissa Saldivar said in a statement.<\/p>\n

\n<\/div>\n

The federal Labor Department did not immediately respond to questions from The Associated Press about the details of the alleged fraud.<\/p>\n

The unemployment insurance program has come into question before<\/h4>\n

The nonpartisan Government Accountability Office estimated that fraud accounted for between 11% and 15% of the amount paid out through unemployment insurance programs from April 2020 through May 2023, when the nation was under a public health emergency for the pandemic.<\/p>\n

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During that time \u2014 which included the last months of Trump\u2019s first term and over half of former President Joe Biden\u2019s time in office \u2014 access to the funds was eased, and the government noticed the issues as the money was going out.<\/p>\n

In the new letter to the states, the department said that consequences from pandemic-era fraud \u201care still playing out.\u201d<\/p>\n

\n<\/div>\n

The Labor Department said states would receive further directives in coming weeks.<\/p>\n

The administration has focused on fraud in state-federal programs<\/h4>\n

Vice President JD Vance is overseeing an anti-fraud task force focused on potential misuse of social programs.<\/p>\n

The Department of Health and Human Services tried to withhold money for child care subsidies and other social service programs from five states \u2014 all governed by Democrats \u2014 but has been rebuffed by a court. The department has also announced it\u2019s using artificial intelligence to police how states and other recipients of federal dollars are auditing their program.<\/p>\n

The Department of Agriculture has threatened to withhold administrative funds from states that don\u2019t provide data on participants in the Supplemental Nutrition Assistance Program, including their immigration status.<\/p>\n

Associated Press reporter Sophie Austin in Sacramento, California, contributed to this article.<\/em><\/p>\n

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The U.S. Department of Labor is telling states they have to combat fraud, waste and abuse in their unemployment insurance programs. 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