The Illinois Auditor General released its annual financial audit of the Illinois Department of Employment Security (IDES) on June 17. The audit, which covers a 1-year period between 2020 and 2021, found that IDES lost nearly $2 billion to fraud from the Pandemic Unemployment Assistance (PUA) program. State Representative Jeff Keicher, R-Sycamore, is calling for immediate hearings into the massive loss of taxpayer dollars.
“The Pritzker administration and IDES have refused to disclose the extent to which fraud affected our unemployment system and this audit makes abundantly clear why,” said Keicher. “The loss of nearly $2 billion dollars, more than half the funds for the PUA program, displays an unprecedented level of negligence by the administration and IDES management at a staggering cost to taxpayers. Just as alarming, as auditors pointed out, IDES doesn’t even have adequate safeguards to protect Unemployment Insurance Trust Fund assets. We need immediate hearings to address these failings.”
The PUA program was created in response to the COVID-19 pandemic for workers not typically covered by standard unemployment benefits, such as those self-employed and gig workers. The program immediately faced fraud and identity theft problems, which IDES and the administration blamed on poor federal guidance. However, a Chicago Tribune investigation published last year revealed IDES failed to follow federal recommendations for fraud prevention tools made available before the pandemic.
The Illinois Auditor General audit found that of $3.6 billion in PUA program funds paid out between July 2020 and June 2021, nearly $1.9 billion was fraud. In the report, auditors called the situation unprecedented. Auditors also noted that IDES has not maintained various records of transactions to beneficiaries for the Unemployment Insurance Trust Fund, nor does it have adequate internal controls to safeguard the fund’s assets for recording transactions.