A Labor Department employee is the latest federal worker to be accused of claiming unemployment benefits while holding down a full-time job with Uncle Sam, highlighting what one leading senator said has become a persistent problem of double-dipping.
Mo Yuong Kang, who worked as an industrial hygienist for the Occupational Safety and Health Administration in 2020 and 2021, was paid a $90,000 annual salary as millions of other Americans were being laid off during the COVID-19 pandemic emergency.
Federal prosecutors said he also applied for and received pandemic unemployment benefits from April 2020 through September 2021. According to the federal indictment, he collected nearly $46,000 in extra cash.
Sen. Joni Ernst, Iowa Republican, said thousands more who held government jobs may have collected unemployment benefits on the side.
She asked the Labor Department inspector general, who helped investigate Mr. Kang, to review the government’s lists of employees and unemployment beneficiaries and see where they overlap.
“Hundreds, even thousands, of government employees appear to have been ripping off the unemployment system by claiming to be unemployed,” she said.
She said the problem extends beyond federal workers.
In Ohio, an inspector general this week reported on a contract employee at the state’s unemployment benefits agency who was found to be collecting benefits for eight months while she held her government job.
The inspector general said Sandra Schnieders, a customer service assistant, also manipulated eight claims, leading to higher payouts for friends and associates. In one case, she boosted the weekly payout from $189 to a maximum of $480. In another case, she approved a file that had been halted, leading to $21,323 in bogus payouts.
Investigators said she was responsible for $112,240 in fraudulent payments, nearly $19,000 of which went to her own pocket.
The pandemic emergency produced a tsunami of fraud. Some estimates suggest that 40% to 50% of the $800 billion in extra federal unemployment assistance was paid in bogus claims.
Under the direction of Congress, which chose to push out money quickly and worry about fraud later, state workforce agencies that administered the program dropped eligibility checks and allowed Americans to self-certify that they were out of work.
That made it easy for people who were employed to claim benefits anyway.
Chasing them down after the fact has proved difficult, but Ms. Ernst said there’s no excuse for federal workers. She said the government has lists of who was working and when.
“It’s time to root out the rip-off artists and put an end to the inside jobs by making it impossible to collect employment and unemployment benefits from the government at the same time,” she said. “Since both lists are maintained by the government, this should be a rather easy fix.”
She said fear of exposure might explain why some federal workers have objected to the Department of Government Efficiency’s access to agency files.
“The deep state doesn’t want those meddling whiz kids at DOGE exposing the Washington corruption that’s been hiding in plain sight for way too long,” said the senator, who chairs the Senate DOGE Caucus.
Mr. Kang left OSHA in 2023.
He was charged Tuesday in federal court in Massachusetts. Court records did not list an attorney for him as of Thursday.
Ms. Ernst said something is particularly galling about federal workers’ fraud, which she likens to an “inside job.”
The perpetrators span the government.
Prosecutors in Texas won a 24-month sentence this year against a Social Security employee who stole identities, including that of a dying man, and then created fraudulent applications in their names. The employee collected Social Security and pandemic emergency stimulus payments.
A Small Business Administration employee used her access to the agency’s systems to approve a bogus $170,000 pandemic loan for herself after it was denied by another loan officer. She also approved loans for her relatives.
Ms. Ernst identified other cases involving the IRS, Amtrak and the U.S. Postal Service, in which a married couple were charged with collecting unemployment benefits while on the job and with stealing pandemic stimulus checks from postal customers.
The problem also extends to the states.
A claims examiner at Michigan’s unemployment benefits office earned a 41-month prison sentence for taking bribes to process at least 40 fraudulent claims for people who were behind bars and thus ineligible.
Authorities said the state paid out more than $1.5 million because of her bogus approvals.
A Louisiana state unemployment agency employee used her access to the system to troll for inactive accounts, reactivate them and route pandemic payments to herself.
After she was fired in March 2021, she applied for her own unemployment. She claimed to be a victim of the pandemic when, in fact, she was fired for cause for misconduct, prosecutors said.
She walked away with more than $200,000 in ill-gotten cash and, as of June, a felony conviction.
In at least some of the double-dipper cases, Ms. Ernst said, the workers are likely victims with stolen identities and bogus applications filed in their names.
She said the audit also would uncover those cases.
The Labor Department inspector general said it had received Ms. Ernst’s request.
• Stephen Dinan can be reached at sdinan@washingtontimes.com.
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