IDES audit highlights Pritzker Administration’s failure to implement fraud-fighting IT controls

Every state in the nation experienced fraud as federal pandemic relief funds were paid out. But in Illinois’ case, it’s estimated that more than half of the federal pandemic relief money distributed between July of 2020 and June of 2021 was paid out to fraudsters. This stunning revelation was included in an audit of the Illinois Department of Employment Security (IDES) that was recently released by the Illinois Auditor General (IAG).

The IAG’s audit highlighted widespread failings at IDES, and two key findings in the report are:

  • IDES failed to implement fraud-fighting IT controls and other best practices to help prevent the payment of bogus claims
  • Sloppy and absent unemployment payment records made it impossible to determine the true extent of the money paid to fraudsters

While fraudsters received checks through an IDES system that failed to verify identities and the legitimacy of claims, real business owners that were forced to close their doors through Gov. Pritzker’s executive orders waited months for service or even a return phone call. Some never received money owed to them, and many never reopened their doors for business.

In a required report to the federal government last year, Gov. Pritzker estimated Illinois had only paid out about $14.2 million in fraudulent pandemic assistance claims. In the IAG’s report, it was estimated that the state paid out a minimum of $1.9 billion in fraudulent claims.

According to Senator Sue Rezin, the scope of the fraud in Illinois could have been reduced if the Pritzker Administration had followed federal guidance for the use of fraud-fighting software, and the indifference shown by not taking every available step toward fraud prevention is unacceptable. Senator Rezin further says that Gov. Pritzker and his appointees at IDES must be held accountable.

The audit also pointed to sloppy or absent record-keeping at IDES. As a result, Illinoisans may never know the true extent of the fraud that took money away from Illinois business owners and channeled it to criminals.

Illinois still has a $1.8 billion hole in the Unemployment Insurance Fund. Due to the negligence and poor decision-making by Gov. Pritzker and his IDES appointees, it is the business owners and taxpayers in this state that will ultimately pay the cost of replenishing those funds.

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