EXCLUSIVE: Julie Su Can’t Count…

The Office of the Inspector General has taken Julie Su’s Department of Labor to task for not being able to give even an estimate of the amount looted by fraudsters from the Pandemic Unemployment Assistance (PUA) program.

Not only does the labor department not have the fraud totals estimate it promised earlier this year, it has not even figured out how to count it and it has even referred to the issue as “largely moot” because the program no longer exists.

In February, Inspector General Larry Turner estimated the national unemployment fraud/improper payment number to be about 21%, or about $190 billion dollars.  But he stressed that did NOT include the PUA program and that number – which he expected to be even larger than 21% and available this summer – is the figure the labor department is balking about determining. The PUA program spent about $137 billion, which would mean even at the 21% rate another $28 billion could have been lost to fraud.

Su – who is stumbling through the Senate confirmation process to become the permanent labor secretary (she’s “acting” labor secretary now) – has consistently, going back to when she was California’s labor secretary and in charge of the California unemployment agency, the Employment Development Department (EDD), claimed that “95%” of the massive fraud perpetrated against the agency was specifically tied to the PUA program.

Su has clearly made the claim to shift blame and obfuscate the truth regarding her gross negligence and the agency’s incompetence as to how and why the EDD lost about $40 billion to fraud.  The “95% PUA” claim is false – mathematically impossible, in fact, but the lack of a specific official amount of PUA fraud from her department means Su can continue to blatantly make that erroneous claim as her confirmation drags on into its fourth bumpy month.

The management of the Department of Labor declined to comment on the report done by its own independent Inspector General’s report. As per Globe standard, the questions are published at the bottom of the story.

The PUA was the source of much of the “extra” federal funds – such as the $600 per week temporary bump –  added to unemployment benefits during the pandemic.

The report is entitled “The U.S. Department of Labor Did Not Meet the Requirements for Compliance with the Payment Integrity Information Act” and goes into specific detail about the failings of the department management across multiple issues.

In a nutshell, and translating from the bureaucratese, the department was required to create a proper way to figure out the PUA fraud losses and then, working with the Office of Management and Budget, post the results on the federal government payment accuracy website.  The site – https://www.paymentaccuracy.gov/ – covers many different departments and programs.

The department failed to do so and the Inspector General recommended management and the OMB continue to work together to create a proper methodology and to determine an “over payment” estimate.

The Inspector General made the same recommendation last year as well, meaning the direction to solve the problem has been ignored since nearly the end of the PUA program in the fall of 2021, well after Su had moved from California to DC.

Department management claimed that it’s difficult to create a report to meet all of the typical standards required, in part because it was a short-lived program that now no longer exists (for example, it noted it could not suggest a way to “fix it” because it’s over.)

In management’s written response contained in the report, management called following all of the requirements “largely moot” due to those factors though it promised to generate a report at some point in the future once it has developed a “satisfactory sampling and estimation methodology” with the OMB.

In other words, Su’s staff says they will take their shoes off so they can count faster and higher.

As promised, the questions referenced:

Will the DOL continue to work to create an estimate or not?  

If that estimate is done, when will it become available?

Why has the estimate not been done yet, as was promised earlier this year?

Does this delay have anything to do with the Su nomination? i.e. publishing a PUA overpayment number at odds with her contention that 95% of all pandemic unemployment fraud was PUA related

Does the DOL truly see the issue as “largely moot”?

The actual reply – “Thank you for your inquiry. The U.S. Department of Labor has no comment at this time.”