Washington AG Reclaims $495,000 In Stolen Unemployment Benefits

OLYMPIA, WA — Washington Attorney General Bob Ferguson says a new tactic has helped reclaim $495,000 stolen from the state through bogus unemployment claims.

In Spring 2020, during the first wave of COVID-19 pandemic, Washington saw a massive swell of unemployment claims as businesses locked down and laid off employees in record numbers. But hidden among the legitimate unemployment claims were more than 96,000 fraudulent claims, hoping to cash in as Washington rushed to pay out benefits to those in need.

In total, fraudsters stole more than $640 million through bogus claims. The Employment Security Department managed to recover $250 million of that money itself last summer, but efforts are ongoing to recover the approximately $315 million that remains lost.

Those efforts include this newest move from the Washington Attorney General's Office (AGO), which the office describes as an "innovative" use of asset forfeiture authority. According to the AGO, while 11 states lost significant amounts of money to unemployment fraudsters last year, Washington is the first to use state asset forfeiture powers to reclaim that money.

As the AGO explains, their office worked with King County Superior Court Judge Johanna Bender, who granted the AGO's motion for forfeiture, ordering TD Bank to transfer $495,000 from 120 accounts holding stolen unemployment benefits. TD Bank reportedly did not oppose the motion.

Now that this effort has paid off, the attorney general says his team will be trying it again with larger banks, and will hopefully recover even more lost funds.

“My legal team is using every tool in our toolbox to recover stolen dollars,” Ferguson said. “Stay tuned because we’re not done.”

The AGO says it has identified and subpoenaed more than 35 banks across America to try and find accounts holding fraudulently-obtained benefits. In particular, the AGO says investigators are looking for accounts that received unemployment benefits from multiple states, unemployment benefits set to multiple people, or accounts that received unemployment benefits for someone other than the account holder.

While they do that, Ferguson's office says it will also move ahead on a separate effort to capture suspects linked to the fraud. Previously, the AGO joined a multi-agency federal law enforcement task force, which resulted in several arrests of Nigerian citizens believed to be behind the fraud ring.

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