Maryland has uncovered a “massive, sophisticated criminal enterprise” that resulted in the filing of 47,500 fraudulent claims totaling over $501 million, Gov. Larry Hogan announced Wednesday.
The “widespread identity theft” was primarily tied to Pandemic Unemployment Assistance claims, which cover independent contractors, gig workers, sole proprietors and other self-employed people, and was discovered over the Fourth of July weekend after the state detected a spike in out-of-state claims, Hogan said.
Maryland then froze all out-of-state accounts, which the governor said resulted in the state catching “the bulk” of fraudulent claims before they were paid out. Some legitimate accounts may have been frozen in the process and Maryland is working to rectify those cases now.
The PUA program — a new federal program created earlier this year as part of the CARES Act — allows claimants to “self-certify” that they are unemployed without needing an employer to do so, which eliminates a check in the process, said Secretary of Labor Tiffany Robinson.