Semiannual Report to Congress, Office of Inspector General for the U.S. Department of Labor, Volume 90 (April 1, 2023–September 30, 2023)
Summary
The Department of Labor Office of Inspector General's Semiannual Report to Congress, Volume 90, covers April 1, 2023 to September 30, 2023. The OIG reports 212 investigative reports issued or cases closed, 247 indictments, 236 convictions and more than $133 million in monetary accomplishments. Applying an estimated 21.52 percent improper payment rate to the approximate $888 billion in pandemic UI expenditures, it says at least $191 billion in pandemic UI payments could have been improperly paid, with a significant portion attributable to fraud. It adds that in August 2023 the Department reported a total improper payment rate of 35.9 percent for the PUA program. Among the cases, a former federal employee was sentenced to 18 years in prison for leading a $3.5 million pandemic UI fraud.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Full text
Volume 90 April 1, 2023–September 30, 2023
Semiannual Report
to Congress
Office of Inspector General for the U.S. Department of Labor
A Message from the Inspector General
I am pleased to submit our Semiannual Report to
Congress summarizing the activities of the U.S.
Department of Labor (DOL or Department), Office of
Inspector General (OIG), for the 6-month period ending
September 30, 2023.
As reflected in our semiannual report, my office
continues to highlight the major issues facing DOL
through the OIG’s independent audits and investigations.
The OIG remains committed to conducting independent
and objective oversight to improve DOL programs relied
upon by millions of Americans.
The OIG has started to rebalance our oversight
post-pandemic with a continued focus on priority
areas such as: (1) worker benefit programs, including
unemployment insurance (UI) and workers’
compensation; (2) worker safety and health, including occupational and miner safety and
health and workplace rights; and (3) employment and training programs, including grants
and the Job Corps program. While the pandemic-related UI programs have ended, the
integrity of DOL’s UI program continues to be threatened by ongoing fraudulent activity and
programmatic weaknesses that preceded and were exacerbated by the pandemic. As I noted
in the last semiannual report, OIG oversight of the UI program still remains significantly
challenged due to resource limitations, data access, and the expiring statute of limitations
related to pandemic UI fraud.
Resource Limitations
Current resource limitations have hampered the OIG’s ability to meet our core mission
and the challenges associated with pandemic-related oversight. The OIG’s Fiscal Year
(FY) 2021 and FY 2022 appropriations remained flat, and the FY 2023 appropriation was
$11 million less than requested. Moreover, our supplemental pandemic funding will be
completely expended by the first half of FY 2024.
As a result, the OIG had to make severe investigative capacity cuts of approximately
20 percent during FY 2023 and, based on current resources, may make an additional 20 or
more percent cut by the end of FY 2024. Similarly, from an audit perspective, we canceled
10 audits planned for FY 2023 and may need to discontinue other planned work in the
coming months.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 1
Statute of Limitations
Currently, the statute of limitations for many pandemic-related UI fraud cases will begin
to expire in early 2025 as the statutes most often used to prosecute UI fraud have 5-year
limitations. We are concerned that, unless Congress acts to extend the statute of limitations
for fraud associated with pandemic-related UI programs, many groups and individuals that
have defrauded the UI program may escape justice. The expansion of the statute of limitations
would provide investigators and prosecutors time to pursue and hold accountable those who
defrauded the UI program and victimized the American people during the pandemic.
Data Access
The barriers to the OIG’s ongoing, timely, and complete access to state UI claimant data and
wage records directly and adversely impact our ability to provide independent oversight to
help DOL reduce improper payments in its programs. While DOL has facilitated temporary
access to UI claimant data and wage records, the Department continues to interpret
regulations as prohibiting the Employment and Training Administration (ETA) from requiring
State Workforce Agencies (SWA) to provide UI data to the OIG for all audit and investigative
purposes other than those involving specific instances of suspected fraud. This interpretation
and subsequent guidance to SWAs contradict the Inspector General Act of 1978, as
amended, which authorizes Inspector General access to DOL grant recipient information
related to DOL programs, including SWAs’ UI data.
To date, ETA has only implemented temporary solutions that are not sufficient to resolve the
OIG’s recommendation or concerns. ETA has required sharing of state UI data as a condition
of fraud prevention grants to provide such access through 2025 and recently issued guidance
supporting additional grants that would provide access for potentially the next 2 to 5 years.
According to ETA, 52 of 53 SWAs received grants. Additionally, ETA announced its intent
to amend its regulations to facilitate the OIG’s ongoing access by February 2025, and,
in July 2023, requested public comment on potential revisions that would require states to
disclose unemployment compensation data to the OIG for oversight, including audits.
OIG Accomplishments
Despite these challenges, OIG staff continues to deliver high-quality oversight. In total, during
this reporting period, the OIG issued 17 audit reports with 49 recommendations for corrective
action and identified approximately $278 million in questioned costs and $6.3 billion in funds
put to better use. Among our many significant findings, we reported:
• Non-traditional claimants received necessary Pandemic Unemployment Assistance (PUA)
benefits as intended, but the program was weakened by, at a minimum, nearly $35 billion
in overpayments, including fraud;
2 Semiannual Report to Congress | April 1, 2023–September 30, 2023
• ETA did not provide adequate oversight over $1 billion in emergency UI administrative
grants and did not verify if states were qualified for the grants before transferring all grant
funds to the states’ accounts;
• ETA and states did not effectively execute the $6.3 billion funded to the 53 SWAs
through the Emergency Unemployment Relief for Government Entities and Nonprofit
Organizations program or ensure full compliance with pandemic-related provisions;
• ETA did not evaluate the capability of SWAs’ UI information technology systems to
successfully administer UI benefits;
• The Occupational Safety and Health Administration (OSHA) needs to do more to address
high injury and illness rates of warehouse workers; and
• OSHA did not effectively manage the awarding process for emergency supplemental
funds under ARPA to maximize coverage across states' State Plans and had insufficient
controls in place to expend funds designated for State Plans.
The OIG’s investigative work also yielded impressive results, with a total of 212 investigative
reports issued / cases closed, 247 indictments, 236 convictions, and more than $133 million
in monetary accomplishments. Highlights of this work follow:
• A former federal employee was sentenced to 18 years in prison for leading a $3.5 million
pandemic UI fraud scheme;
• An international firearms dealer involved in a $1.9 million pandemic UI relief fraud scheme
was sentenced to more than 7 years in prison;
• Nine defendants were sentenced to more than 63 years combined imprisonment in a
$126 million, years-long, multistate pharmaceutical compounding fraud scheme to
submit false and fraudulent claims to the Office of Workers’ Compensation Programs
and TRICARE;
• Two owners and a manager of a Virginia commercial laundry business were sentenced to
prison for their roles in a labor trafficking and money laundering conspiracy; and
• A Guatemalan man was sentenced to over 6 years in prison for his role in the forced labor
of two minor Guatemalan victims.
These outstanding accomplishments reflect the dedication and commitment to our mission by
the hard-working OIG staff.
In closing, I would like to thank Congress and the Department for their support of our work
to identify improvements to DOL programs and operations and to protect the interests and
benefits of the nation’s workers and retirees.
Larry D. Turner
Inspector General
Semiannual Report to Congress | April 1, 2023–September 30, 2023 3
OIG Fiscal Year 2022–2026 Strategic Plan
OIG Mission
We serve the American people, DOL, and Congress by providing independent and
objective oversight of Departmental programs through audits and investigations,
and by combatting the influence of labor racketeering in the workplace.
Core Values
Excellence
We deliver relevant, quality, timely, high-impact products and services, through a
workforce committed to accountability and the highest professional standards.
Integrity
We adhere to the highest ethical principles and perform our work in an honest and
trustworthy manner.
Independence
We are committed to being free of conflicts of interest through objectivity and impartiality.
Service
We are a unified team, vigilant to duty through dedicated public service.
Transparency
We promote an environment of open communication through information sharing,
accountability, and accurate reporting.
Strategic Goals
Goal 1: Deliver timely, relevant, and high-impact results.
Goal 2: Foster an internal OIG culture that drives high performance and engagement.
Goal 3: Promote responsible stewardship of OIG financial and non-financial resources.
4 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Contents
Selected Statistics . . . . . . . . . . . . . . . . . . . . 6 Appendices . . . . . . . . . . . . . . . . . . . . . . . . 121
Reporting Requirements Under
Significant Concerns . . . . . . . . . . . . . . . . . . 8 the Following Acts . . . . . . . . . . . . . . . . . . 122
Worker and Retiree Benefit Programs . . . 35 Funds Recommended for Better Use . . . 124
Unemployment Insurance Programs . . . . 36 Questioned Costs . . . . . . . . . . . . . . . . . . 125
Office of Workers’ Compensation Final Audit Reports Issued . . . . . . . . . . . 126
Programs . . . . . . . . . . . . . . . . . . . . . . . . 80 Other Reports . . . . . . . . . . . . . . . . . . . . . 128
Worker Safety, Health, and Workplace Unresolved Audit Reports Over
Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 6 Months Old . . . . . . . . . . . . . . . . . . . . . 129
Occupational Safety and Health Management Decision Made During this
Administration . . . . . . . . . . . . . . . . . . . . . 84 Reporting Period on Audits, Inspections,
or Evaluations Issued during a Previous
Reporting Period
Employment and Training Programs . . . . 89
Final Audit Reports Issued . . . . . . . . . 131
Employment and Training Administration
Programs . . . . . . . . . . . . . . . . . . . . . . . . 90 Other Reports Issued . . . . . . . . . . . . 133
Foreign Labor Certification Programs . . . 93 Corrective Actions Taken by
the Department . . . . . . . . . . . . . . . . . . . 134
Labor Racketeering . . . . . . . . . . . . . . . . . . 95
Unimplemented Recommendations . . . . . 138
Departmental Management . . . . . . . . . . . . 97 High-Priority Unimplemented
Recommendations . . . . . . . . . . . . . . . . . 139
Single Audits . . . . . . . . . . . . . . . . . . . . . . 103
Summary of Reports with Unimplemented
Employee Integrity Investigations . . . . . . 105 Recommendations with Cost Savings /
Funds Put to Better Use . . . . . . . . . . . . 144
OIG Whistleblower Activities . . . . . . . . . . 107 Reports with Unimplemented
Recommendations for Management
Legislative Recommendations . . . . . . . . . 111 Improvement or Disallowed Costs Owed . 145
Investigative Statistics . . . . . . . . . . . . . . . 149
Peer Review Reporting . . . . . . . . . . . . . . 151
OIG Hotline . . . . . . . . . . . . . . . . . . . . . . . 152
Fiscal Year 2024 Audit Workplan . . . . . . 153
Acronyms and Abbreviations . . . . . . . . . . 172
Audit Statistics
17 49 $6.3 Billion $278 Million
Audits and Other Recommendations for in Funds Put to in Questioned
Reports Issued Corrective Action Better Use Costs
$ ?
OIG Unimplemented Recommendations
OIG recommendations not fully implemented as of September 30, 2023
EBSA 2
ETA 43
MSHA 29
OASAM 27
OCFO 18
OFCCP 1
OASP 5
OSHA 19
OWCP 12
WHD 4
0 10 20 30 40 50
6 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Investigative Statistics
Investigative Results Labor Racketeering
Program Fraud
197/212
247 236
212
197
139
112
197 investigative
3 cases opened and
212 cases closed
r r s s ry ts
s d
se ose
s d
se ene fo tion fo tion e nt i on to en
a a d u d c t u
C Cl C Op rre ec rre l A ict
m ic at rm
fe ros e fe ivi d o nv St eba
e
R P R /C In C D
s es ses min
a a d
C C A
Monetary Accomplishments
$
Types include: $5,700,064
Recoveries
Cost-Efficiencies
Restitutions
Fines/Penalties
Forfeitures
Civil Monetary Actions
$127,784,754
$133,484,818
Total Labor Racketeering
Program Fraud
Semiannual Report to Congress | April 1, 2023–September 30, 2023 7
Significant Concerns
Significant Concerns
The Office of Inspector General (OIG) has identified the following areas of significant concern that cause
the U.S. Department of Labor (DOL or Department) to be at particular risk for fraud, mismanagement,
waste, abuse, or other deficiencies. The identified areas of concern reflect continuing matters as well as
emerging issues. Many of these issues are detailed in our annual Top Management and Performance
Challenges report, which can be found in its entirety at www.oig.dol.gov.
Deploying Unemployment
Insurance Benefits DOL’s Limited Authority
Expeditiously and Efficiently in Maintaining the
While Reducing Improper Integrity of Foreign Labor
Payments Certification Programs
Providing the OIG Access to Improving the Performance
UI Claimant Data and Wage Accountability of Workforce
Records Development Programs
Extending the Statute
of Limitations associated Ensuring the Safety of
with Pandemic-Related Students and Staff at
Unemployment Insurance Job Corps Centers
Fraud
Unused Funds in State Managing Medical
UI Accounts Need to Benefits in the Office of
Be Returned to the Workers’ Compensation
Federal Government Programs
Ensuring the Solvency
Curtailing Child Labor
of the Black Lung Disability
Law Violations
Trust Fund
Managing and
Protecting the Safety and
Securing Data and
Health of Workers
Information Systems
Ongoing Impact of
Protecting the
Protecting the Safety Resource Limitations
Security of Employee
and Health of Miners on the OIG’s Ability to
Benefit Plan Assets
Conduct Oversight
8 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
Deploying Unemployment Insurance report outlined areas of concern that the
Benefits Expeditiously and Efficiently Department and states should consider
While Reducing Improper Payments as they implemented the Coronavirus Aid,
Relief, and Economic Security (CARES) Act
The OIG has long reported significant UI provisions. One of these areas was state
concerns with the Department and states’ preparedness, specifically, the issues of
ability to deploy unemployment insurance staffing and system capabilities. Our audit
(UI) program benefits expeditiously and work has confirmed these issues persisted
efficiently while ensuring integrity and into the pandemic. For example, many
adequate oversight. We renewed this states had not developed or implemented UI
concern in March 2020 at the onset of the information technology (IT) modernization
COVID-19 pandemic as UI claims began to plans that improved the timeliness or
rise to historically unprecedented levels—far accuracy of UI benefits processing.1
higher than state systems were designed to
handle. In the more than 3 years since, our We found that, during the year following
concern has grown as workers waited for UI passage of the CARES Act, more than six
benefits, improper payments soared, and our million Americans waited a month or more
audit and investigative work found program for pandemic-related UI benefits.
weaknesses and related criminal activity has
persisted throughout and after the federal Rapid deployment of CARES Act funding was
emergency. We remain particularly concerned critical to helping workers in need. OIG work
about deployment of UI benefits in response found continuing programmatic weaknesses
to emergencies, including natural disasters led to certain workers, unemployed through
and economic downturns. Unless more is no fault of their own, suffering lengthy delays
done now at the federal and state level to in receiving benefits. We found that, during
increase systemic integrity in the UI program, the year following passage of the CARES
the program’s weaknesses will continue to Act, more than six million Americans waited
negatively impact American taxpayers and a month or more for pandemic-related UI
workers both under current conditions and in benefits. Further, states are still challenged in
the face of the next emergency. paying claimants timely. In August 2023, only
34 percent of reporting states were paying
Based on years of oversight relating to regular UI claimants timely versus 75 percent
DOL’s UI program, including the response before the pandemic started.2
to past disasters, our April 2020 advisory
1 COVID-19: Audit of State Workforce Agencies’ Information Technology Systems Capability in Processing
Unemployment Insurance Claims, Report No. 19-23-008-03-315 (September 19, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-008-03-315.pdf
2 Based on OIG analysis of data on the Employment and Training Administration’s public reporting on States’ UI
Benefit Timeliness and Quality, available at: https://oui.doleta.gov/unemploy/btq.asp
Semiannual Report to Congress | April 1, 2023–September 30, 2023 9
Significant Concerns
Reducing Improper Payments,
including Fraud
For over 20 years, the OIG has reported on
weaknesses in the Department’s ability to
measure, report, and reduce improper payments
in the UI program, which has experienced
some of the highest improper payment rates
across the federal government. The reported
improper payment rate estimate for the regular
UI program has been above 10 percent3 for
16 of the last 19 years.4
Our recommendations have specifically
included the need for the Department to
estimate improper payments within federally
funded temporary emergency programs,
such as Pandemic Unemployment Assistance
(PUA), Pandemic Emergency Unemployment
Compensation (PEUC), and Federal
Pandemic Unemployment Compensation
(FPUC). More than a year after our
August 2020 recommendation,5 the Employment which were applied to FPUC and PEUC. Based
and Training Administration (ETA) began on audit and investigative work, the improper
applying its measured estimated improper payment rate for pandemic-related UI programs
payment rate for regular UI to FPUC and PEUC. was likely higher than 21.52 percent.
In December 2021, ETA reported an estimated
improper payment rate of 18.71 percent, and, In congressional testimony in February 2023,6
in December 2022, ETA reported an estimated we noted that more than $888 billion in total
improper payment rate of 21.52 percent, both of federal and state UI benefits were paid for
3 To fully comply with the Payment Integrity Information Act of 2019, agencies must report an improper payment rate
of less than 10 percent for each program and activity for which an estimate was published.
4 UI improper payments data for Fiscal Year 2004 through Fiscal Year 2022 as reported to the Office of Management and Budget.
5 COVID-19: More Can Be Done to Mitigate Risk to Unemployment Compensation under the CARES Act,
Report No. 19-20-008-03-315 (August 7, 2020), available at:
https://www.oig.dol.gov/public/reports/oa/2020/19-20-008-03-315.pdf
6 “The Greatest Theft of American Tax Dollars: Unchecked Unemployment Fraud,” Hearing, Statement for the
Record of Larry D. Turner, Inspector General, U.S. Department of Labor; House Committee on Ways and Means
(February 8, 2023), available at: https://www.oig.dol.gov/public/testimony/02082023.pdf
10 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
benefit weeks during the UI pandemic period.7 and states are still reporting, elevated levels of
Applying the estimated 21.52 percent improper improper payments in the UI program.
payment rate to the approximate $888 billion
in pandemic UI expenditures, at least In August 2023, the Department reported
$191 billion in pandemic UI payments could that the PUA program had a total improper
have been improperly paid, with a significant payment rate of 35.9 percent.10 According to
portion attributable to fraud.8 ETA officials, the small-scale review used to
calculate the improper payment rate estimate for
The potential loss of $191 billion of taxpayer PUA cannot be used to estimate the PUA fraud
money highlights the need for systemic rate. The fraud rate—which is a subset of the
improvements. For perspective, $191 billion improper payment rate—for pandemic-related
could have provided more than $3.5 billion to UI programs was likely higher than the fraud
each state workforce agency (SWA)9 toward rate for regular UI programs. Notably, in the first
ensuring preparedness for emergencies, 6 months after the CARES Act passed, we found
including modernizing UI IT systems, enhancing 4 states paid $1 out of every $5 in PUA benefits
staffing levels, and formulating robust to likely fraudsters. In 2023,11 the Government
contingency plans. To recover the improperly Accountability Office (GAO) estimated the
paid benefits and mitigate the impact of these pandemic-related fraud rate, including PUA, was
losses, collaboration between ETA and the about 11 to 15 percent for the period April 2020
states is vital. These issues have persisted to May 2023, and estimated up to $135 billion
after the pandemic; the OIG is seeing, and ETA was lost to fraud.
7 With the exception of PUA, for which claims could be backdated to January 27, 2020, we define the UI pandemic
period as March 27, 2020, through September 6, 2021.
8 Fraud is a type of improper payment. The Office of Management and Budget explains that, at a high level, a
payment is “improper” if made in an incorrect amount or to the wrong recipient. Improper payments can result in
a money loss that was either unintentional (accidental) or intentional (fraud). For more information, see Office of
Management and Budget, Appendix C to OMB Circular A-123, Requirements for Payment Integrity Improvement,
Memorandum (March 5, 2021), last accessed September 27, 2022, available at:
https://www.whitehouse.gov/wp-content/uploads/2021/03/M-21-19.pdf.
9 When referring to UI, this Semiannual Report to Congress uses “state” or “SWA” to refer to the administrative
body that administers the program within the state, district, or territory. For the 50 states, as well as the U.S. Virgin
Islands, the Commonwealth of Puerto Rico, and the District of Columbia, that administrative body is a SWA. There
are, therefore, 53 SWAs. The CARES Act also provided certain UI benefits to American Samoa, the Commonwealth
of the Northern Mariana Islands, the Federated States of Micronesia, Guam, the Marshall Islands, and the Republic
of Palau, provided they signed an agreement with the Department.
10 This breakdown includes an overpayment rate of 17 percent, an underpayment rate of 1.5 percent, and a 17.4
percent rate for benefits whose classification—whether valid, overpaid, or underpaid—could not be determined. This
information was reported in ETA’s report, “Pandemic Unemployment Assistance Improper Payment Rate Report”
(August 21, 2023), last accessed October 13, 2023, available at: https://oui.doleta.gov/unemploy/improp_pay.asp#.
11 GAO, Unemployment Insurance: Estimated Amount of Fraud during Pandemic Likely between $100 Billion and
$135 Billion, GAO-23-106696 (September 2023), available at: https://www.gao.gov/assets/gao-23-106696.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 11
Significant Concerns
We continue to review and evaluate improper has resulted in the indictment/initial charging
payment rate estimates.12 Estimating the of over 1,550 criminals, including members of
improper payment rate for all emergency UI the Robles Park criminal organization—whose
programs is critical for the efficient operation members and associates engaged in acts
of the program. ETA and the states, under involving murder, assault, narcotics trafficking,
their program operating responsibilities, must identity theft, and other crimes; a massive and
determine the improper payment rate, including sophisticated criminal enterprise targeting the
the fraud rate, for pandemic UI programs. State of Maryland’s UI system; former state
or federal employees; individuals using sham
Combatting Large-Scale Fraud companies; a Nigerian national sentenced for
both UI and elder fraud schemes; and even an
Inspector General Larry D. Turner, during individual who was sentenced to 77 months in
his March 2022 congressional testimony,13 prison and ordered to pay more than $700,000
reported that the unprecedented infusion of in restitution after bragging online about his
federal funds into the UI program—combined efforts to defraud a state UI agency.
with continuing program weaknesses and
easily attainable stolen personally identifiable When the OIG identifies anti-fraud
information (PII)—provided a high-value target measures that may help the program,
for fraudsters to exploit. For example, an we share them with the Department and
individual could make a fraudulent claim with SWAs, as appropriate. For example, our
relatively low risk of being caught and, as time investigators, auditors, and data scientists
went on, one fraudster could have been issued collaboratively identified14 $46.9 billion in
several UI debit cards, with tens of thousands potentially fraudulent UI benefits paid in the
of dollars on each card. now six high-risk areas,15 to individuals with
Social Security numbers:
Our investigators have identified crimes related 1. filed in multiple states,
to UI fraud committed by bad actors both in
2. of federal prisoners,
the United States and abroad, and our work
12 At the time of the publication of this semiannual report, the OIG has not audited the reported PUA improper
payment rate. The OIG will assess that rate’s compliance with the Payment Integrity Information Act of 2019 for
Fiscal Year 2023. That audit report will be available in Summer 2024.
13 “Pandemic Response and Accountability: Reducing Fraud and Expanding Access to COVID-19 Relief through
Effective Oversight,” Hearing, Statement for the Record of Larry D. Turner, Inspector General, U.S. Department of
Labor; Senate Committee on Homeland Security and Governmental Affairs (March 17, 2022), available at:
https://www.oig.dol.gov/public/testimony/20220317.pdf
14 Alert Memorandum: ETA Needs to Incorporate Data Analytics Capability to Improve Oversight of the
Unemployment Insurance Program, Report No. 19-23-012-03-315 (September 25, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-012-03-315.pdf
15 Previously, we have reported on four high-risk areas; we added two areas: individuals with Social Security
numbers belonging to persons under 14 and over 100 years of age.
12 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
3. used to file for UI claims with suspicious the efforts were not sufficient to protect
email accounts, pandemic-related UI funds from historic levels
4. of deceased persons, of improper payments. In April 2022, ETA stated
that a swift rollout of a new government benefit
5. belonging to individuals under 14 years of
program would be 30 to 48 months. The OIG
age, and
acknowledges ETA’s statement that states’
6. belonging to individuals 100 years of age or ability to provide benefit payments within 1 to
older (see Figure 1). 2 months for a new, temporary UI program is a
very impressive achievement given the extensive,
We recommended states establish effective complex requirements and activities that were
controls to mitigate fraud and other improper necessary for implementation. However, we
payments to ineligible claimants and are remain concerned that, given the nature of
examining whether states took effective emergency situations, states would be unlikely
measures to address the initial four high-risk to have a lengthy rollout period for emergency
areas. Additionally, in Spring 2023, we started programs. ETA and states must include risk
assessing the effects of waivers and blanket planning that would identify measures to facilitate
waivers on the recovery of UI overpayments, the creation of new programs similar to the ones
including fraud. While DOL provided guidance created in response to the pandemic.
correctly stating that recovery of fraudulent
payments may not be waived, we remain Providing the OIG Access to UI
concerned that states may have unintentionally Claimant Data and Wage Records
waived or will waive fraudulent payments.
Barriers to the OIG’s ongoing, timely, and
As we reported, ETA and states made significant complete access to UI claimant data and wage
efforts under extreme circumstances; however, records from SWAs remains a significant
Figure 1: Six High-Risk Areas for Potential UI Fraud
Source: OIG analysis
Semiannual Report to Congress | April 1, 2023–September 30, 2023 13
Significant Concerns
concern. This deficiency directly and adversely the OIG took the unprecedented step of using
impacts the OIG’s ability to provide independent Inspector General subpoenas to obtain this
oversight and combat fraud, waste, and critical data.
abuse to help DOL improve the integrity of
the UI programs. The power and use of data DOL continues to interpret regulations at 20
and predictive analytics enables the OIG Code of Federal Regulations (C.F.R.) Part 603
to continuously monitor DOL programs and as prohibiting ETA from requiring SWAs to
operations to detect and investigate fraud. provide UI data to the OIG for all audit purposes
Continuous monitoring serves as a deterrent to and for investigative purposes other than those
fraud, allows the OIG to promptly discover areas involving specific instances of suspected fraud.
of weakness, and enables DOL management to This interpretation and subsequent guidance
timely correct problems. to SWAs contradict the Inspector General
Act of 1978, as amended, which authorizes
To effectively address the challenges posed mandatory Inspector General access to
by the pandemic, we took a proactive stance, information available to DOL, including grant
employing data analytics at both national and recipient information related to DOL programs,
state levels to identify high-risk areas within such as SWAs’ UI data.16 In our June 2021
the UI program. However, the OIG’s ability to alert memorandum,17 we recommended ETA
proactively detect UI fraud continues to be amend its regulations to reinforce that SWAs’
impacted by DOL’s interpretation that the OIG’s UI information must be provided to the OIG for
ongoing, timely, and complete access to UI all engagements authorized under the Inspector
claimant data and wage records is limited to the General Act of 1978, as amended.
pandemic period and related grants.
To date, ETA has only implemented temporary
Prior to and during most of the pandemic period, solutions that are not sufficient to resolve the
DOL maintained that, under its regulations, OIG’s recommendation or concerns. ETA
SWAs were only required to disclose UI data to has required sharing of state UI data as a
the OIG for specific fraud investigations. DOL condition of fraud prevention grants to provide
asserted it lacked the authority to require SWAs such access through 2025 and recently issued
to provide UI data to the OIG for audits and guidance supporting additional grants that
investigations, despite the Inspector General Act would provide access for potentially the next
of 1978, as amended, authorizing the Inspector 2 to 5 years. According to ETA, 52 of 53
General’s access for such purposes. As a result, SWAs received grants. ETA stated it was able
16 Further, only a federal statute, not DOL’s regulations, can supersede the Inspector General’s access authority,
and only if it expressly states that it limits the Inspector General’s authority.
17 Alert Memorandum: The Employment and Training Administration Needs to Issue Guidance to Ensure State
Workforce Agencies Provide Requested Unemployment Insurance Data to the Office of the Inspector General,
Report No. 19-21-005-03-315 (June 16, 2021), available at:
https://www.oig.dol.gov/public/reports/oa/2021/19-21-005-03-315.pdf
14 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
to require SWAs to provide UI data to the OIG OIG highlighted DOL’s authority to amend its
due to temporary authority created by the interpretation of its regulations without changing
CARES Act and subsequent pandemic-related the regulations themselves. Specifically, ETA can
legislation. Because DOL issued its guidance issue guidance to inform SWAs that they must
pursuant to pandemic-related legislation, timely provide UI data without any constraints to
DOL’s guidance directs states that they must the OIG for audits and investigations consistent
provide OIG access only for the pandemic with the Inspector General Act of 1978, as
period and until the expiration of the grants, amended. The historic levels of improper
which is contrary to the Inspector General Act payments that the OIG has identified, including
of 1978, as amended. potential fraud, support the conclusion that
he OIG’s continued access to state UI data
The historic levels of improper payments is imperative.
that the OIG has identified, including
potential fraud, support the conclusion In support of the OIG’s oversight activities,
that the OIG’s continued access to state the OIG needs access to UI claimant data and
UI data is imperative. wage records from SWAs to verify claimants’
eligibility for UI benefits, including both initial
ETA announced its intent to amend its eligibility (and amounts) and continuing
regulations to facilitate the OIG’s ongoing eligibility. Timely access to UI data will allow
access by February 2025, and, in July 2023, the OIG to use our data analytics program to
requested public comment on potential identify and investigate complex identity theft
revisions that would require states to disclose and multistate fraud schemes as we have
unemployment compensation data to the successfully done during the pandemic. The
OIG for oversight, including audits. Until DOL OIG could also use those records to assess
implements a permanent solution ensuring program outcomes for UI reemployment
the OIG’s complete and timely access to UI programs, as well as other training programs,
program data and information, the Department’s such as YouthBuild and Job Corps, where
interpretation of its regulations may renew employment and wage increases are important
impediments to the OIG’s access experienced factors in determining a program’s success.
prior to and during the pandemic.
In addition to the Inspector General Act of
While the OIG and ETA agree that changing 1978, as amended, Congress should consider
regulations requires notice and comment legislative action that would specifically
rulemaking, an immediate and legally sound authorize DOL and the OIG to have ongoing,
interim solution is available to ETA. In the alert timely, and complete access to UI claimant
memorandum issued September 21, 2022,18 the data and wage records for our oversight
18 Alert Memorandum: Potentially Fraudulent Unemployment Insurance Payments in High-Risk Areas Increased to
$45.6 Billion, Report No. 19-22-005-03-315 (September 21, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 15
Significant Concerns
responsibilities. Ongoing, timely, and complete most often used to prosecute UI fraud have
access to SWA UI claimant data and wage 5-year limitations.
records systems would further enable the OIG
to quickly identify large-scale fraud and expand As previously stated, during the pandemic,
its current efforts to share emerging fraud the volume of the OIG’s UI investigative
trends with ETA and states to strengthen the UI matters increased a thousandfold. Prior to the
program and deter fraud. pandemic, the OIG opened approximately 100
UI fraud investigative matters each year. As of
Extending the Statute of Limitations September 2023, the OIG has opened more
associated with Pandemic-Related than 205,000 investigative matters related to the
pandemic. We continue to receive, on average,
Unemployment Insurance Fraud
100 to 500 new UI fraud complaints each week
from the National Center for Disaster Fraud.
We are increasingly concerned that, unless
Congress acts urgently to extend the statute
As a direct result of the exponential increase
of limitations for fraud associated with
in pandemic-related UI fraud referrals, OIG
pandemic-related UI programs, many groups
investigators are now carrying the largest
and individuals that have defrauded the UI
case inventory in the OIG’s history. We are
program may escape justice. As the primary
still dedicating the majority of our investigative
federal law enforcement agency responsible
resources to addressing pandemic-related UI
for providing oversight of the UI program, the
fraud matters. This issue is further exacerbated
OIG has vigorously pursued pandemic-related
by the OIG’s significant reduction in the
UI fraud. As of September 30, 2023, OIG
number of investigators onboard due to the
investigations have resulted in more than
near exhaustion of supplemental pandemic
1,550 individuals being charged with crimes
funding, resulting in a significant decrease in
involving UI fraud since March 2020.19
investigative capacity.
Even with the OIG’s tireless efforts, the current
Pandemic-related UI fraud referrals that we
statute of limitations associated with UI fraud
receive often include complex schemes involving
means federal law enforcement may still fall
criminal enterprises and bad actors who use
short in fully investigating and prosecuting the
sophisticated techniques to maintain their
most egregious cases of UI fraud, especially
anonymity. For instance, in one pandemic-related
given the volume and complexity of UI fraud
UI fraud investigation into the theft of over
matters we are tasked to investigate. Currently,
$4 million in UI benefits, conspirators
the statute of limitations for many of these cases
orchestrated a scheme to file UI claims using
will begin to expire in early 2025 as the statutes
stolen identities, which were often associated
19 For more details about OIG investigations, visit our Pandemic Response Portal at:
https://www.oig.dol.gov/OIG_Pandemic_Response_Portal.htm.
16 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
with elderly citizens.20 The conspirators then Force, the COVID-19 Fraud Enforcement Task
opened bank accounts using the stolen identities Force, and the COVID-19 Fraud Enforcement
for the sole purpose of receiving fraudulent UI Strike Force teams to investigate and prosecute
proceeds. They withdrew the fraudulent proceeds UI fraud. While these investigative resources
and purchased money orders made out to helped us address the incredible volume of UI
themselves and to an online vehicle auction fraud matters, the process of collecting and
company. The conspirators then laundered the cleaning the SWA data required a significant
UI funds by using the money orders to purchase amount of time. We leveraged the UI data we
salvaged automobiles in the United States and were able to collect to identify those matters
ship them to Nigeria. They also facilitated the that posed the greatest risk to the UI program;
transfer of conspiracy proceeds to overseas however, to most effectively and efficiently
bank accounts. This complex fraud investigation investigate these matters, we need additional
spanned both domestic and foreign jurisdictions. time, data, and resources.
The defendants have been convicted of
conspiracy to commit wire fraud. Supplemental pandemic resources from
Congress allowed the OIG to hire more criminal
investigators and significantly expand the
number of staff reviewing UI fraud matters.
Unfortunately, the OIG is in the process of
reducing staffing to pre-pandemic levels due
to the near exhaustion of the supplemental
funding provided by Congress. We have also
been forced to eliminate all of the approximately
20 contract staff we have been using to triage
the approximately 205,000 UI fraud complaints
we received during the pandemic. Despite
our dwindling resources, the OIG anticipates
identifying and investigating pandemic-related
UI fraud until the statute of limitations expires.
Absent congressional action, the statute of
Criminal investigations like this one require limitations will begin to expire in early 2025.
significant resources and time. We leveraged
additional resources by partnering with SWAs, In August 2022, an extension of the statute of
the U.S. Department of Justice (DOJ), and limitations was implemented for crimes involving
other federal law enforcement agencies on the U.S. Small Business Administration’s
the National Unemployment Insurance Task Paycheck Protection Program (PPP) and
20 Department of Justice, U.S. Attorney’s Office, Northern District of Alabama, “Georgia Resident Pleads Guilty to
COVID-19 Unemployment Fraud Targeting Several States,” press release (June 8, 2022), available at:
https://www.justice.gov/usao-ndal/pr/georgia-resident-pleads-guilty-covid-19-unemployment-fraud-targeting-several-states
Semiannual Report to Congress | April 1, 2023–September 30, 2023 17
Significant Concerns
Economic Injury Disaster Loan (EIDL) program. than $5 billion. These programs made funding
Congress should likewise consider extending available to SWAs through reimbursements
the statute of limitations for existing laws when that states drew down from state UI accounts.
pandemic-related UI programs are defrauded. The programs ended in September 2021; some
The expansion of the statute of limitations of the remaining funds may be attributable to
would provide investigators and prosecutors adjustments to claims that SWAs still need to
time to pursue and hold accountable those who make. However, ETA and SWAs need to perform
defrauded the UI program and victimized the reconciliations to determine exactly how much
American people during the pandemic. money needs to be deobligated and returned to
the U.S. Department of the Treasury (Treasury).
Further, for similar reasons, Congress could
consider extending the federal statute of In two CARES Act UI programs, TFFF
limitations for states to pursue administrative and EURGENO, recent work identified
recoveries in cases of proven overpayments, the need for reconciliation of more than
including fraud, and with appropriate due process. $5 billion.
Unused Funds in State UI Accounts During our audit of TFFF, we identified that
Need to Be Returned to the Federal ETA made approximately $12.5 billion of
funding available in the 53 SWAs’ invested
Government
Federal Unemployment Accounts.22 The SWAs
accessed the funds as reimbursement of
As a result of recent work, we are concerned that
100 percent 23 of benefits paid to claimants for
a significant amount of pandemic-related
their first week of regular UI compensation.
federal funding remains in state UI accounts.
Overall, 53 states drew down about
For example, in two CARES Act UI programs,
$7.5 billion of the approximately $12.5 billion
Temporary Full Federal Funding of the First
made available, leaving nearly $5 billion
Week of Compensable Regular Unemployment
(40 percent) unused as of July 31, 2023—
for States with No Waiting Week (TFFF)
more than 22 months after the benefit eligibility
and Emergency Unemployment Relief
period expired. ETA needs a plan for states
for Governmental Entities and Nonprofit
to reconcile and close out these accounts for
Organizations (EURGENO),21 recent work has
proper disposition of remaining funds. With no
identified the need for reconciliation of more
formal plan to return unused funds to Treasury,
21 In Unemployment Insurance Program Letter 18-20, ETA refers to EURGENO as “Emergency Unemployment Relief
for State and Local Governmental Entities, Certain Nonprofit Organizations, and Federally-Recognized Indian Tribes.”
22 Treasury transfers funds from the general fund to the Federal Unemployment Account in amounts estimated by
ETA to be necessary to reimburse the states for first week regular UI compensation paid. The Federal Unemployment
Account is an account within the federal Unemployment Trust Fund that pays for the costs to administer the UI
program, emergency benefits, loans to state trust funds, and program expansions like the CARES Act.
23 Although this amount was temporarily reduced to 50 percent from January through mid-March of 2021, it was
retroactively restored to 100 percent for that period through the program’s expiration in September 2021.
18 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
the remaining balances are vulnerable to fraud, than 10 million workplaces. The Fair Labor
waste, and abuse. Standards Act of 1938 sets standards
for minimum wage and overtime, among
During our audit of EURGENO, we identified others, including youth employment.
that ETA made approximately $6.3 billion of Enforced by DOL’s Wage and Hour Division,
relief funds available to the 53 SWAs’ UI trust the standards for youth employment are
funds. EURGENO was designed to mitigate commonly known as child labor laws and
the effects of the pandemic on employers that are meant to ensure youth employment is
reimburse SWAs for eligible UI benefits paid safe, appropriate, and does not jeopardize
(reimbursing employers). The SWAs accessed youth health, wellbeing, or educational
relief funds to provide refunds to reimbursing opportunities. We are concerned about the
employers or to fund credits extended to these rise in child labor law violations and the
employers—amounting to 50 percent 24 or recent reductions in child labor protections
75 percent 25 of the employers’ cost of UI with additional proposals pending.
benefits. However, the audit identified
that, 16 months after EURGENO ended, 26 Since 2018, DOL has reported a 69 percent
approximately $844.1 million of EURGENO increase in children being employed in
relief funds (19 percent of the total $4.5 billion violation of child labor laws. In Fiscal Year
allocated), remained unused in 32 states’ (FY) 2022, DOL found 835 companies it
UI trust funds. Given that this data does not investigated had employed more than 3,800
include 21 SWAs, there could potentially be children in violation of child labor laws.
millions of dollars more remaining in other Furthermore, the increase in child labor law
states’ UI trust funds that needs to be returned violations is occurring while the Wage and
to the federal government. Hour Division struggles to retain investigators.
In addition, two laws recently passed in the
Curtailing Child Labor Law Violations States of Arkansas and Iowa to weaken
child labor protections. Similarly, in 2023,
Collectively, U.S. labor laws cover most six bills to weaken child labor protections have
private, state, and local government been introduced in the States of: Minnesota,
employment and protect more than Missouri, Nebraska, Ohio, and South Dakota.
148 million of America’s workers in more We are currently examining the Wage and
Hour Division’s efforts to curtail child labor
24 Under the CARES Act provisions, reimbursing employers were eligible to receive relief through refunds after they
paid their bills in full. On August 3, 2020, the Protecting Nonprofits from Catastrophic Cash Flow Strain Act of 2020
became law, which required states to provide reimbursing employers with 50 percent relief through credits.
25 On March 11, 2021, the American Rescue Plan Act of 2021 was signed into law, which increased the relief
percentage from 50 percent to 75 percent, beginning after March 31, 2021. According to ETA guidance, this
effectively increased the rate by the week ending April 11, 2021.
26 The EURGENO program ended on September 6, 2021. As of February 1, 2023, the total balance for the
32 states remained at approximately $844.1 million.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 19
Significant Concerns
law violations and attempting to determine the to be challenged with reaching the number of
cause for the rise of such violations. worksites for which it is responsible.
Protecting the Safety and Health In early 2023,27 we found OSHA did not
of Workers consistently ensure complaints and referrals
were adequately addressed nor did it
Responsible for the safety and health of regularly enforce hazard abatement timelines.
approximately 130 million workers employed at Specifically, we found OSHA did not consistently
more than 8 million worksites, the Occupational involve the complainant and/or witnesses in the
Safety and Health Administration (OSHA) must investigation or inspection processes. Further,
ensure employers are providing the level of OSHA has no policy requiring Compliance
protection required under relevant laws and Safety and Health Officers, those responsible
policies. Federal law entitles U.S. workers for performing inspections and investigations, to
to a safe and healthful workplace. Failure to interview or otherwise involve the complainant
keep workplaces free of known safety and after the complaint is filed.
health hazards can lead to serious legal
consequences, injuries, illnesses, and fatalities. However, that person may have key insights to
The OIG remains concerned about OSHA’s ensure alleged hazards are being addressed.
ability to target its compliance activities to areas OSHA interviewed the complainant in 50 percent
where it can have the greatest impact. of sampled complaints. In all sampled cases
where OSHA interviewed the complainant and/
OSHA carries out its compliance responsibilities or witnesses, each person was only interviewed
through a combination of self-initiated inspections once. Additionally, OSHA did not consistently
and those resulting from complaints and referrals. follow procedures in its Field Operations Manual
In FY 2023, OSHA conducted 34,273 inspections, involving documentation of decision points,
including 17,480 unprogrammed inspections. indicating a possible inadequacy in its inspection
Unprogrammed inspections result from employee processes. Finally, OSHA did not regularly ensure
complaints, injuries/fatalities, and referrals. OSHA safety and health violations from complaints and
must target the most egregious or persistent referrals were corrected in a timely manner.
violators to protect the most vulnerable worker
populations. OSHA has since increased its In this reporting period, the OIG found28 OSHA’s
number of inspectors—from 750 in 2021, to 931 Site-Specific Targeting programs—which were
as of March 31, 2023. However, OSHA continues specifically designed to reach establishments
27 OSHA Needs to Better Address Complaints and Referrals for Increased Worker Safety,
Report No. 20-23-001-10-105 (March 6, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/02-23-001-10-105.pdf
28 COVID-19: OSHA Needs to Do More to Address High Injury Rates of Warehouse Workers,
Report No. 19-23-013-10-105 (September 27, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-013-10-105.pdf
20 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
with high rates of serious injuries—had limited
controls in place to ensure an adequate number
of targeted Site-Specific Targeting program
inspections occurred. It also did not timely
monitor program activity to determine how many
of the proposed inspections actually occurred
until after the programs ended. Very few
inspections of targeted establishments meant
workers remain vulnerable to continuously high
rates of injury and illness.
Further, OSHA’s ability to target enforcement is
also impacted by its limited visibility. We found,
on average, between 2016 and 2020, 59 percent
of establishments in all industries failed to
submit their mandatory annual injury and illness
reports to OSHA. Additionally, OSHA could not First, we are concerned regarding MSHA’s
identify if an establishment met the criteria for ability to conduct inspections. The Federal Mine
mandatory reporting and, therefore, could neither Safety and Health Act of 1977 requires MSHA
proactively remind specific establishments that to inspect every underground mine at least
they must report nor effectively cite employers for four times per year and every surface mine
non‑compliance. Non‑reporting continues to be a at least two times per year. Although MSHA
challenge for OSHA and results in an incomplete has reported a nearly 100 percent completion
view of workplace injury and illness. rate, MSHA may not be completing all of
its mandatory inspections. The agency is
Protecting the Safety and Health challenged with identifying when a mine needs
of Miners a change in the mine’s operating status or
verifying its status, which factors into how
The Mine Safety and Health Administration’s many inspections MSHA conducts at the mine.
(MSHA) mission is to prevent death, injury, Not maintaining an accurate mine status in its
and illness from mining and promote safe and system has also led to other significant issues,
healthful workplaces for U.S. miners. The OIG such as abandoned mines not being sealed in
is significantly concerned about four aspects of accordance with the Federal Mine Safety and
MSHA’s ability to successfully fulfill its mission: Health Act of 1977 and potentially presenting a
(1) conducting inspections, (2) writing violations danger to the public.
for identified hazards, (3) reducing fatalities,
and (4) completing rulemaking for respiratory Second, we are concerned about MSHA’s ability
protection of miners. to write violations for hazards that it identifies
Semiannual Report to Congress | April 1, 2023–September 30, 2023 21
Significant Concerns
during inspections. An OIG audit 29 found MSHA Third, we are concerned about the high level
inspectors were not writing violations that of miner fatalities in two areas. According
adhered to the Federal Mine Safety and Health to MSHA’s data, powered haulage and
Act of 1977 and MSHA guidance for two machinery accidents are the leading causes of
reasons: (1) they were not following the miner fatalities (see Figure 2). Together, they
guidance and (2) system controls were missing accounted for half of all mine fatalities since
or improperly designed. We also found MSHA 2022 and that percentage has already increased
inspectors were extending violations for as of September 2023.
unjustified reasons and not timely verifying
whether mine operators had abated hazards by MSHA has taken steps to reduce powered
required due dates. This was generally due to haulage fatalities, such as when it launched an
inspectors being responsible for mines located enforcement initiative in November 2021 with
across large geographic areas and not revisiting guidance on preventing accidents and meeting
the mines by the due dates. with mine personnel to emphasize best safety
Figure 2: Number and Percentage of Top 8 Classes of Mining Fatalities,
Calendar Years 2018–2023
Source: MSHA’s Accident Injuries public dataset, as of September 8, 2023
29 MSHA Can Improve How Violations Are Issued, Terminated, Modified, and Vacated, Report No. 05-21-002-06-
001 (March 31, 2021), available at: https://www.oig.dol.gov/public/reports/oa/2021/05-21-002-06-001.pdf
22 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
practices and training. In addition, MSHA has The Federal Mine Safety and Health Act of 1977
issued safety guidance for powered haulage gives the U.S. Secretary of Labor authority to
equipment and implemented an enhanced develop, promulgate, and revise mining health
enforcement program. The OIG will continue to or safety standards for the protection of life and
monitor MSHA’s efforts to decrease powered prevention of injuries and illnesses. Respirable
haulage accidents. crystalline silica can cause deadly and incurable
chronic conditions, such as black lung disease.
Also, MSHA has started taking steps to reduce
machinery-based fatalities. For instance, in Protecting the Security of Employee
October 2023, MSHA issued a safety alert Benefit Plan Assets
identifying recent fatal machinery accidents and
best practices for miners to mitigate the risk of The OIG remains concerned about the Employee
accidents occurring. Likewise, in September Benefits Security Administration’s (EBSA) ability
2023, MSHA submitted its final rule on Safety to protect the integrity of pension, health, and
Programs for Surface Mobile Equipment to other benefit plans of about 153 million workers,
the Office of Management and Budget (OMB), retirees, and their families under the Employee
which would require mine operators to establish Retirement Income Security Act of 1974 (ERISA).
a written safety program for mobile equipment In particular, the OIG is concerned about the
and powered haulage equipment (except belt statutory limitations on EBSA’s oversight authority
conveyors) used at surface mines and surface and inadequate resources to conduct compliance
areas of underground mines. The OIG will and enforcement.
continue to monitor MSHA’s efforts to decrease
machinery-based accidents. A decades-long challenge to EBSA’s
compliance program, ERISA provisions allow
Finally, while MSHA has issued a proposed billions of dollars in pension assets to escape
rule to lower the allowable respirable crystalline full audit scrutiny. The act generally requires
silica exposure level for miners in July 2023, every employee benefit plan with more than
we are still concerned about MSHA’s ability to 100 participants to obtain an audit of the plan’s
complete rulemaking for respiratory protection financial statements each year. However, an
of miners. It has started and restarted its exemption in the law allowed auditors to perform
rulemaking efforts for respirable crystalline “limited-scope audits.” These audits excluded
silica regulations at least six times since 1996. pension plan assets already certified by certain
An OIG audit found MSHA’s allowable limit banks or insurance carriers and provided little to
for respirable crystalline silica had remained no confirmation regarding the actual existence
unchanged for more than 50 years. This or value of the assets.
proposed rule would allow MSHA to issue a
citation and monetary penalty at coal mines In 2013 and in 2014, we reported that as much
when violations of its respirable crystalline silica as $3 trillion in pension assets—including
exposure limit occur (current MSHA standards an estimated $800 billion in hard-to-value
already allow this at metal nonmetal mines). alternative investments held in otherwise
Semiannual Report to Congress | April 1, 2023–September 30, 2023 23
Significant Concerns
regulated entities such as banks—received improve the Thrift Savings Plan’s cybersecurity
limited-scope audits that provided weak posture. As a significant portion of the Thrift
assurance to participants regarding the Savings Plan’s infrastructure was recently
financial health of their plans. In 2019, transferred to an outside third-party vendor, we
the American Institute of Certified Public are concerned about the threat cybersecurity
Accountants updated its accounting standards breaches pose to the Thrift Savings Plan.
related to these types of audits. The new More generally, identifying and mitigating cyber
standards replaced limited-scope audits with threats requires a high degree of technical
audits from ERISA Section 103(a)(3)(C) and expertise. Cyber threats potentially place at
imposed new performance requirements on risk trillions of dollars in other ERISA-covered
plan management and auditors. In FY 2024, retirement plan assets.
we plan to follow up on our previous work on
EBSA’s oversight of limited-scope audits. DOL’s Limited Authority in Maintaining
the Integrity of Foreign Labor
EBSA needs to focus its limited available Certification Programs
resources on investigations that are most
likely to result in the prevention, detection, The DOL foreign labor certification (FLC)
and correction of Employee Retirement programs are intended to permit U.S.
Income Security Act of 1974 violations. This employers to hire foreign workers to meet their
is particularly important given the number workforce needs while protecting U.S. workers’
of benefit plans EBSA oversees relative jobs, wages, and working conditions. DOL’s
to the number of investigators it employs. administration of FLC programs under current
Finally, EBSA lacks the authority under the laws has been a concern for the OIG for
Federal Employees’ Retirement System Act decades. Our work has shown these visa
to effectively oversee hundreds of billions programs—in particular the H-1B program for
in federal employee Thrift Savings Plan workers in specialty occupations—to be
assets.30 The Federal Employees’ Retirement susceptible to significant fraud and abuse from
System Act requires EBSA to conduct regular perpetrators, including immigration agents,
compliance audits to determine whether attorneys, labor brokers, employers, and
the Federal Retirement Thrift Investment organized criminal enterprises. Over the last
Board, an independent agency, is fulfilling its decade, the OIG, along with federal partners,
fiduciary duties and properly safeguarding has conducted 160 criminal investigations
Thrift Savings Plan participants’ assets. related to fraud in FLC programs. Of particular
concern, OIG investigations have uncovered
However, EBSA has limited legal authority to criminal misuse of FLC programs to engage in
compel the Federal Retirement Thrift Investment human trafficking—with victims being exploited
Board to implement its recommendations, which for economic gain.
includes enforcing its recommendations to
30 The total value of Thrift Savings Plan assets fluctuates over time and is affected by market volatility.
24 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
As we have reported since 2003,31 DOL
continues to have limited authority over the
H-1B program and permanent employment
certification program (PERM), which challenges
the goal of protecting the welfare of the nation’s
workforce. The statute limits DOL’s ability to
deny H-1B applications and to investigate
potential violations. Specifically, DOL may only
deny incomplete and obviously inaccurate H-1B
applications and has only limited authority to
conduct H-1B investigations in the absence of
a complaint. Without statutory authority, the
Department generally cannot verify employers’
attestations to the H-1B certifications unless a
complaint is filed or the Department utilizes a
Secretary-initiated investigation.
As foreign workers are generally reluctant
to file complaints for fear of retaliation and
losing their jobs, the Department’s process is
unlikely to result in verification action being
taken. The PERM program itself is persistently
vulnerable to employers not complying with its
qualifying criteria. Therefore, both the PERM
and H-1B programs remain prone to fraud.
With various new DOL rules going into effect
since 2003, including implementing employer
self-attestation programs, there have been
opportunities for the PERM, H-2A, and H-2B
visa programs to change. However, DOL has
identified instances in which employers are not
complying with the conditions of employment,
thereby reinforcing how susceptible these
programs are to fraud.
31 Overview and Assessment of Vulnerabilities in the Department of Labor’s Alien Labor Certification Programs,
Report No. 06-03-007-03-321 (September 30, 2003), available at:
https://www.oig.dol.gov/public/reports/oa/2003/06-03-007-03-321.pdf; also see: Overview of Vulnerabilities and
Challenges in Foreign Labor Certification Programs, Report No. 06-21-001-03-321 (November 13, 2020), available
at: https://www.oig.dol.gov/public/reports/oa/2021/06-21-001-03-321.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 25
Significant Concerns
FLC vulnerabilities have also been exploited employer wealth. These case examples illustrate
to facilitate labor trafficking, a type of human how criminals exploit weaknesses in the FLC
trafficking. For example, in a recent OIG programs to commit even more serious crimes,
investigation, four individuals were sentenced as such as forced labor and labor trafficking.
part of a federal racketeering conspiracy, which Therefore, it is crucial that the Department do all
victimized Mexican agricultural workers admitted it can to ensure the integrity of these programs.
to the United States under the H-2A temporary
visa program. The investigation revealed the Improving the Performance
conspirators committed multiple offenses, Accountability of Workforce
including subjecting H-2A workers to forced Development Programs
labor, harboring and concealing workers, visa
fraud, and fraud in foreign labor contracting.
The OIG has concerns about the Department’s
The conspirators used coercive means to obtain ability to ensure its investments in workforce
thousands of hours of physically demanding development programs are successful in
agricultural labor from the victimized H-2A enhancing participants’ skills and placing them
workers, all for lesser pay. The coercive in good employment. The pandemic’s impact
means used included confiscating the workers’ on the workforce highlighted the importance
passports; subjecting the workers to crowded, of these programs in assisting job seekers
unsanitary, and degrading living conditions; and employers in finding and filling available
isolating the workers and limiting their ability to jobs and assisting workers in developing
interact with anyone other than employees; and the right skills to fill new job openings. The
subjecting workers to debt manipulation. Department’s ability to obtain accurate and
reliable data to measure, assess, and make
In some instances, employers commit FLC fraud decisions regarding the performance of grant
to engage in forced labor or labor trafficking. recipients, contractors, and states in meeting
Engaging in the FLC process allows prospective the programs’ goals is critical.
employers to recruit skilled, motivated, and
legally well-intentioned workers, and also entice Our audit work from September 2020 found
them to the jobsite. This saves the employer that, although ETA had data to determine
from paying costly human smuggling expenses whether or not participants were employed
and limits liability associated with smuggling after exiting grant-funded training programs,
or the harboring of undocumented workforces. ETA lacked data to measure the impact
Once the workers are onsite, the employer can credentials had on participants’ outcomes
control/compel labor and services by: holding and did not ensure participants’ data was
their travel documents; threatening to revoke accurate, valid, and reliable. Similarly, in a
their visas and “blacklisting” them in the future; 2018 audit, we found that Job Corps was
controlling how much money they possess; unable to demonstrate the extent to which its
and limiting their access to adequate food, training programs helped participants obtain
housing, or outside contact. Often, the goal meaningful jobs appropriate to their training
is to use the exploited work force to increase within 5 years of completing the program.
26 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
As expressed in a March 2022 advisory report, with federal requirements when paying $168,460
the OIG continues to be concerned about three in services. We also questioned $6.9 million in
areas in particular where our body of work has grant funding because the sub-recipients could
identified weaknesses: (1) awarding grants, not show how these funds were used.
(2) reviewing grant recipients’ use of funds,
and (3) measuring grant recipient performance. The OIG is also concerned about the
While ETA took action to address many prior Department’s ability to ensure its investments
years’ findings and recommendations related into Registered Apprenticeships develop new
to eligibility, effectiveness, and compliance and pathways to good-quality jobs. Congress invested
monitoring, it must also proactively monitor $285 million into the Registered Apprenticeship
key areas and continue to assess for these Program in FY 2023. However, a 2021 audit of
weaknesses to ensure they do not reoccur. the American Apprenticeship Initiative Grant
Program found systemic weaknesses in the
execution of the grants, planning, and awarding
processes. As such, the OIG continues to be
concerned that issues and challenges continue
to exist within this program.
Ensuring the Safety of Students and
Staff at Job Corps Centers
Ensuring the safety and health of students
and staff at Job Corps centers continues to
be a concern due to ongoing issues with
on-campus violence. In Program Year 2022,
In September 2023, we reported32 ETA needs Job Corps centers reported almost 1,300
to improve its oversight of grant recipients and on-campus assaults. Job Corps centers are
sub-recipients33 in the State of New Jersey to mostly residential, with students living on-
ensure that grant funds serve their intended campus. Preventing on-campus violence and
purposes. We found ETA did not ensure other potentially criminal behavior remains a
recipients effectively: (1) used over $100 million challenge for Job Corps centers.
to serve the intended population; (2) enrolled
eligible individuals in the grant programs, costing OIG audits from 2015 and 2017 found that
$96,580 in training services; and (3) complied some Job Corps centers failed to report and
32 COVID-19: The Employment and Training Administration Needs to Improve Oversight of Grants Awarded in New
Jersey, Report No. 19-23-016-03-391 (September 28, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-016-03-391.pdf
33 A sub-recipient is a non-federal entity that receives a sub-award from a pass-through entity to carry out part of a
federal program. It does not include an individual who is a beneficiary of the program.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 27
Significant Concerns
investigate serious misconduct, such as drug continues to monitor various safety initiatives
abuse and assaults. The audits also determined and actions taken by Job Corps to keep
that some Job Corps centers downgraded students and staff safe.
incidents of violence to lesser infractions,
creating an unsafe environment for students Managing Medical Benefits in the
and staff. The follow-up work we completed in Office of Workers’ Compensation
December 2017 and our review of Job Corps’ Programs
corrective actions showed Job Corps has taken
steps to improve center safety and security The OIG has concerns about the Office of
by establishing stronger internal controls and Workers’ Compensation Programs’ (OWCP)
security measures, including the installation of ability to effectively manage the use and cost
security cameras, perimeter fencing, and better
of pharmaceuticals in the Federal Employees’
lighting at centers. However, concerns continue. Compensation Act (FECA) program and about
rising home health care costs in the Energy
Job Corps’ participants can range in age from Employees Occupational Illness Compensation
16 to 27 years old.34 The significant age range Program Act (Energy) program. The Department
poses a number of challenges. Given the needs to ensure the medical benefits it provides
occurrence of sexual assaults and harassment to FECA claimants and energy workers are safe,
on center campuses, there is an inherent risk with effective, medically necessary, and cost effective.
having adults cohabitate with minors. The OIG is
currently performing an audit focused on whether Our audit work in the FECA program continues
Job Corps ensured the safety of and mitigated to identify concerns with OWCP’s management
program disruptions involving its minor students. of pharmaceuticals. In March 2023,35 we
reported OWCP did not effectively manage
A March 2021 OIG audit report showed Job pharmaceutical spending in the FECA program
Corps centers lacked the appropriate tools from FY 2015 through FY 2020. Specifically,
and resources to properly evaluate and OWCP did not pay the best available prices
mitigate issues related to substance abuse for prescription drugs that resulted in up to
and mental health. We found that center $321 million in excess spending during the
personnel frequently attributed student and audit period. OWCP also did not effectively
staff safety concerns to mental health or monitor pharmaceutical policy changes to
substance abuse, or both. The use of fentanyl, ensure implementation, which resulted in
a potentially lethal and extremely addictive claimants receiving thousands of inappropriate
drug, is also an emerging concern. The OIG prescriptions and potentially lethal drugs,
34 Individuals aged 16 through 24 years are eligible to enroll in Job Corps and, once enrolled, can be in training for
up to 3 years before finishing the program.
35 OWCP Did Not Ensure Best Prices and Allowed Inappropriate, Potentially Lethal Prescriptions in the FECA
Program, Report No. 03-23-001-04-431 (March 31, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/03-23-001-04-431.pdf
28 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
including 1,330 prescriptions for fast-acting implement processes that ensure competitive
fentanyl after issuing a policy that restricted prices for prescription drugs (see Figure 3),
its use. We also found OWCP failed to timely improve its monitoring of pharmaceutical policy
identify and address emerging issues and did changes, and proactively identify emerging
not perform sufficient oversight of prescription issues before they become critical problems.
drugs that are highly scrutinized and rarely
covered in workers’ compensation programs. In March 2021, consistent with our prior audit
recommendations, OWCP implemented a
To strengthen its management of FECA’s pharmacy benefit manager36 responsible for
pharmaceutical program, OWCP needs to FECA pharmaceutical transactions, including
Figure 3: Tools to Ensure Competitive Prices for Prescription Drugs
Source: OIG graphic representation of Harper, Rains, Knight & Company, P.A. analysis
36 Pharmacy benefit managers are third-party administrators of prescription drug programs, primarily responsible
for: developing and maintaining formularies, which include an approved listing of prescriptions; negotiating discounts
and rebates with drug manufacturers; and processing and paying prescription drug claims.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 29
Significant Concerns
pricing for prescription drugs. In addition, Lung Disability Trust Fund (Trust Fund) pays
OWCP is in the process of expanding the benefits when a miner’s former employer
pharmacy benefit manager coverage to the does not or cannot assume liability. The OIG’s
Energy and Black Lung Benefits programs. primary concern is that the current annual
While using a pharmacy benefit manager income of the Trust Fund (primarily from an
may improve OWCP’s management of excise tax on coal) is not sufficient to cover
pharmaceuticals, it does not relieve OWCP annual benefit obligations to meet administrative
from its management responsibilities. OWCP costs and to service past debt.
needs to provide adequate oversight over
the pharmacy benefit manager to ensure The Trust Fund expenditures have
the pharmaceutical benefits it provides are consistently exceeded revenue, and the
safe, effective, medically necessary, and Trust Fund has essentially borrowed with
economical. We plan to conduct follow-up work interest from Treasury’s general fund almost
focusing on how effectively OWCP’s pharmacy every year since 1979. According to DOL’s
benefit manager reduced opioid-related risks, FY 2023 Agency Financial Report, the Trust
pharmaceutical costs, and fraud. Fund had to borrow approximately $2.73 billion
to cover its expenditures, which included debt
In the Energy program, with an aging claimant and interest payments. As of September 30,
population and an increased demand for 2023, the Trust Fund was carrying close to a
home health care services, there is a risk of $6.36 billion deficit balance, which is projected
providers exploiting these benefits through to grow to $12.64 billion (in constant dollars) by
unethical practices. Since 2010, home and September 30, 2048.
residential health care costs paid by the
Energy program have grown from almost The excise tax that funds the Trust Fund
$100 million to more than $860 million, is levied on domestic sales of coal mined
representing approximately 82 percent of in the United States. On August 16, 2022,
total medical benefits paid by the program in the Inflation Reduction Act of 2022 made
FY 2022. OWCP needs to continue its efforts permanent the temporary increased excise tax
to analyze home health care billing for abusive rates of $1.10 per ton of underground-mined
practices and to identify and refer allegations coal and $0.55 per ton of surface-mined coal,
involving potential fraud or abuse to the OIG with a cap of 4.4 percent of the sales price.
for further investigation. However, we remain concerned the permanent
tax increases are still not sufficient to ensure
Ensuring the Solvency of the Black solvency of the Trust Fund. The Department
Lung Disability Trust Fund has proposed a new rule to strengthen
security requirements for coal mine operators
Miners and their dependent survivors receive requesting authorization to self-insure liabilities
lifetime benefits when awarded under the that it believes would decrease the potential
Black Lung Benefits Act. Mine operators pay burden of those liabilities on the Trust Fund
these benefits when possible, and the Black should the operator become insolvent.
30 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
Managing and Securing Data and ensure the Department’s IT governance
Information Systems is effectively implemented. Specifically,
the Chief Information Officer’s authority is
We remain concerned about the Department’s limited by both structural design and lack of
ability to manage and secure its data and representation in enterprise level discussions.
information systems. The Department and its DOL’s Chief Information Officer reports to
program agencies depend on reliable and the Assistant Secretary for Administration
secure IT systems to perform their mission and Management—not the Secretary or
critical functions. In carrying out their missions, Deputy Secretary as required by law—and
the agencies obtain and create vast amounts of the Chief Information Officer position does not
information and data, and included in these data have sufficient authority or representation on
are the PII and personal health information of key senior level management boards.
the public, including federal employees. The
Department moved to an IT shared services In addition, we continue to have concerns with
model that centralized IT for approximately 70 the Department’s information security program
percent of its information systems under the in the following areas:
Office of the Assistant Secretary for • cybersecurity oversight,
Administration and Management. While we have • supply chain,
seen some improvements in the Department’s
IT management, we continue to have concerns • cloud/third-party,
with its governance structure and information • end user/remote security, and
security program. • emerging technology and security
requirements, such as zero trust architecture.
Fundamentally, we continue to be concerned
that DOL has not fully empowered the Securing the Department’s information systems
Chief Information Officer position to remains a concern as we continue to identify
Semiannual Report to Congress | April 1, 2023–September 30, 2023 31
Significant Concerns
recurring deficiencies in the Department’s efforts Ongoing Impact of Resource
to manage and implement security controls Limitations on the OIG’s Ability to
throughout its information security program.37 Conduct Oversight
While the Department has moved information
systems to its IT shared services model to We are significantly concerned about the
improve management and security of the ongoing impact of resource limitations on our
systems, the Department has not adequately ability to conduct oversight. The OIG is in the
implemented information security controls and process of significantly reducing its workforce
technology tools required to manage and monitor through attrition and has had to reduce our
IT security. Further, we are still concerned that planned oversight efforts due to budgetary
the remaining systems and agencies that are constraints. Essentially, the degree to which
not part of the IT shared services environment we can continue our level of oversight work
are not receiving the governance and oversight depends on the availability of resources.
required to sufficiently secure all of DOL’s data Moreover, the statute of limitations for most
and information systems. pandemic-related UI fraud will begin to expire in
early 202538 and we continue to face challenges
These areas represent ongoing risks with data access, both of which are also
to the confidentiality, integrity, and significant concerns previously mentioned in this
availability of DOL’s information systems, document that may impede oversight.
which are necessary to support the
Department’s mission. We will continue to efficiently and effectively
use our available resources; however, at
These areas represent ongoing risks to the current funding levels, resource limitations have
confidentiality, integrity, and availability of DOL’s resulted and will continue to result in a reduction
information systems, which are necessary to of oversight in both the Offices of Audit and
support the Department’s mission. DOL needs Investigations. For example, due to budget
to implement the necessary strategies and tools constraints, we cancelled 10 contracted audits
to provide effective management and security planned for FY 2023, in the areas of: dislocated
for its data and information systems as well as worker grants (1), job training (5), worker safety
to support the execution of its mission. (1), and UI (3). These cancellations will result
in fewer recommendations for improvement of
Department programs and operations. Further,
37 Under the Federal Information Security Modernization Act of 2014, the OIG is required to perform annual
independent evaluations of the Department’s information security program and practices. These annual reports
have consistently identified such deficiencies. For the most recent, see: FY 2022 FISMA DOL Information
Security Report: DOL’s Information Security Program Not Remaining Current with Security Requirements,
Report No. 23-23-001-07-725 (February 10, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/23-23-001-07-725.pdf.
38 For most crimes of fraud committed against the UI program, an indictment must be returned by a grand jury or
information must be instituted within 5 years of the offense being committed.
32 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Significant Concerns
the OIG will not have the investigative capacity While we have efficiently deployed our
to review the approximately 166,000 open UI available resources to produce impactful
fraud complaints and to conduct investigations results and will continue to do so, there
of each instance of suspected fraud before the is much more to do. For example, our
statute of limitations expires. investigators continue to work tirelessly to
seek recoveries from and indictments for
The immense challenges we continue to face those responsible for pandemic-related fraud.
have not stopped OIG auditors or investigators Even though the COVID-19 public health
from producing impactful oversight. As of emergency has ended, the OIG continues its
September 30, 2023,39 our pandemic response work focused on assisting DOL to recover from
oversight has identified more than $74 billion in this unprecedented emergency and to prepare
funds for better use and investigative monetary for any future emergencies.
results of over $1 billion (see Table 1).
Table 1: DOL OIG’s Cumulative Pandemic-Related Results, as of September 30, 2023
Results 2023
Audit Reports 47
Recommendations 136
Funds Identified for Better Use $74 billion+
Questioned Costs $277 million+
Indictments/Initial Charges 1,552
Convictions 957
Months of Incarceration Ordered 19,000+
Investigative Monetary Results $1 billion+
39 Pandemic Response Oversight Plan, Revised June 30, 2023, available at:
https://www.oig.dol.gov/public/oaprojects/2023%20Revised%20Pandemic%20Response%20Oversight%20Plan.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 33
Worker and Retiree
Benefit Programs
Worker and Retiree Benefit Programs
Unemployment Insurance Programs
Enacted more than 80 years ago as a federal-state partnership, the unemployment insurance
program is the Department’s largest income-maintenance program. This multi-billion-dollar program
provides unemployment benefits to eligible workers who become unemployed through no fault of
their own. The program is generally administered by states with oversight from DOL’s Employment
and Training Administration.
OIG OVERSIGHT OF THE meet eligibility requirements. It is equally
UI PROGRAM important that the program has sufficient
controls in place to quickly determine that
Background benefits are or were paid to the right person in
the correct amount. Each SWA:
The OIG has remained committed to meeting • administers a separate UI program under
the challenges created by the COVID-19 its jurisdiction’s laws, but follows uniform
pandemic and to assisting DOL and Congress guidelines established by federal law;
in improving the efficiency and integrity of the
• establishes requirements for eligibility,
UI program. Strengthening the UI program to
benefit amounts, and the length of time that
prevent fraud before it occurs and to detect it
benefits can be paid; and
when it does are key objectives to ensure that
unemployed workers expeditiously receive • manages the personnel and system resources
much needed benefits while safeguarding tax to administer its respective programs.
dollars directed toward that goal. Recovering
improper payments creates challenges for all In normal circumstances, UI benefits are
involved. Strengthening programs to prevent generally funded by state employer taxes with
improper payments in the first place is critical administrative costs funded by the federal
for program integrity and good stewardship of government. Extensions and expansions of
taxpayer funding. coverage and benefits, such as those provided
by the CARES Act and subsequent legislation,
are also normally funded in whole or in part by
Overview of the UI Program
the federal government.
A joint federal-state program, UI is the first
ETA is the federal agency responsible for
economic line of defense against the collective
providing program direction and oversight.
impact of unemployment and acts as a safety-net
The OIG conducts independent oversight of
for individuals who lose their jobs through no
the UI program through audits to strengthen
fault of their own. The UI program requires
the integrity and efficiency of the program
states to make benefit payments in a timely
and through criminal investigations to detect
manner, providing needed assistance to
and deter large-scale fraud. The OIG’s
unemployed workers while ensuring claimants
36 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
federal criminal investigations are time- and workers both under current conditions and in
resource-intensive and one of the last lines the face of the next emergency.
of defense in safeguarding the UI program
from fraud. Our April 2020 advisory report40 outlined areas
of concern the Department and the states
OIG Historical Concerns regarding the should consider as they implemented the
UI Program CARES Act UI programs. Our identification of
these areas represents years of work relating
The OIG has long reported significant concerns to DOL’s UI program, including the response
with the Department and states’ ability to to past disasters. One of these areas was
deploy UI program benefits expeditiously state preparedness, specifically, the issues of
and efficiently while ensuring integrity staffing and system capabilities. Our audit work
and adequate oversight. We renewed this has confirmed these issues persisted into the
concern in March 2020 at the onset of the pandemic.41 For example, many states had not
COVID-19 pandemic as UI claims began to developed or implemented UI IT modernization
rise to historically unprecedented levels—far plans that improved the timeliness or accuracy
higher than state systems were designed to of UI benefits processing.42 Ensuring states
handle. In the more than 3 years since, our have these plans in place—and are actively
concern has grown as workers waited for UI pursuing implementation—would be a strong
benefits, improper payments soared, and our step toward improving the administration of
audit and investigative work found program benefits, particularly during a future crisis.
weaknesses and related criminal activity has
persisted throughout and after the federal Deploying Benefits Expeditiously
emergency. We remain particularly concerned and Efficiently
about deployment of UI benefits in response
to emergencies, including natural disasters Rapid deployment of CARES Act funding was
and economic downturns. Unless more is critical in helping workers in need. Staff at ETA
done now at the federal and state level to and states struggled during the COVID-19
increase systemic integrity in the UI program, pandemic as SWAs worked to ensure timely
the program’s weaknesses will continue to and accurate UI benefits in a time of national
negatively impact American taxpayers and emergency. Anticipating and addressing the
40 Advisory Report, CARES Act: Initial Areas of Concern Regarding Implementation of Unemployment Insurance
Provisions, Report No. 19-20-001-03-315 (April 21, 2020), available at:
https://www.oig.dol.gov/public/reports/oa/2020/19-20-001-03-315.pdf
41 COVID-19: States Struggled to Implement CARES Act Unemployment Insurance Programs,
Report No. 19-21-004-03-315 (May 28, 2021), available at:
https://www.oig.dol.gov/public/reports/oa/2021/19-21-004-03-315.pdf
42 COVID-19: Audit of State Workforce Agencies’ Information Technology Systems Capability in Processing
Unemployment Insurance Claims, Report No. 19-23-008-03-315 (September 19, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-008-03-315.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 37
Worker and Retiree Benefit Programs
increased risk that came with the expanded To implement the new UI programs authorized
funding was also vital to meeting the intent by the CARES Act, states needed sufficient
of the CARES Act. As the OIG’s prior audit staffing and system resources to manage the
work has shown, quickly deploying funds can extraordinary increases in the number of claims.
result in shortcomings in the effective and Our pandemic audit work has confirmed that
efficient implementation of stimulus programs. ETA and states continued to face challenges in
For example, a 2011 audit report43 found these areas as they endeavored to implement
states took over a year to spend most of the the new temporary UI programs, including PUA,
American Reinvestment and Recovery Act PEUC, and FPUC.
of 2009 (Recovery Act) funding available for
emergency staffing and at least 40 percent of Our subsequent reports found continuing
funding for this purpose was unspent after programmatic weaknesses led to certain
15 months. workers, unemployed through no fault of their
own, suffering lengthy delays in receiving
In addition, a separate audit on the Recovery benefits. For example, states without
Act44 found $1.3 billion of the $7 billion DOL modernized IT systems faced difficulty in
provided to states for UI modernization, promptly implementing the CARES Act
including IT modernization, would likely not programs.45 Further, for the PEUC program,
have been spent before the period of availability we identified that it took 49 states, on average,
expired. To access these funds, states had 50 days to implement the program.46 However,
to meet certain modernization criteria; once states with modernized IT were able to
accessed, the funds could be spent for several implement the PEUC program 15 days faster.
purposes including to modernize IT systems. Similarly, modernized states implemented the
Of the funds spent from the $7 billion, states did PUA program 8 days faster.
not always take advantage of the opportunity to
modernize their IT systems. Also, from April 1, 2020, to March 31, 2021,
only 5 of the 53 SWAs were able to timely pay
43 Recovery Act: DOL Could Have Better Monitored the Use of Re-employment Services Funds to Adhere to
Standards for Transparency and Accountability, Report No. 18-11-005-03-315 (March 31, 2011), available at:
https://www.oig.dol.gov/public/reports/oa/2011/18-11-005-03-315.pdf
44 Recovery Act: More Than $1.3 Billion in Unemployment Insurance Modernization Incentive Payments Are
Unlikely to Be Claimed by States, Report No. 18-10-012-03-315 (September 30, 2010), available at:
https://www.oig.dol.gov/public/reports/oa/2010/18-10-012-03-315.pdf
45 COVID-19: States Struggled to Implement CARES Act Unemployment Insurance Programs,
Report No. 19-21-004-03-315 (May 28, 2021), available at:
https://www.oig.dol.gov/public/reports/oa/2021/19-21-004-03-315.pdf
46 Also, the 12 states we selected for in-depth analysis were generally unable to demonstrate they met the
payment promptness standard ETA established for regular UI payments, which is to pay 87 percent of claimants
within 14 to 21 days.
38 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
benefits, including the FPUC supplement, to Specifically, to combat imposter claims,
regular UI claimants.47 As a result, during the 45 percent of states hired identity verification
year following passage of the CARES Act, more service contractors that used facial recognition
than six million Americans waited a month or technology. In 2019, the National Institute of
more for pandemic-related UI benefits. Further, Standards and Technology’s49 Information
states are still challenged in paying claimants Technology Laboratory reported 50 it found
timely. In August 2023, only 34 percent of states empirical evidence that the algorithms51 used
were paying regular UI claimants timely versus in current facial recognition technology have
75 percent before the pandemic started.48 a racial and gender bias. Furthermore, 15 of
24 (63 percent) state contracts did not include
Only 34 percent of states paid regular UI privacy security measures recommended to
claimants timely versus 75 percent before protect UI claimants’ biometric data.52
the pandemic started.
Further, we issued audit reports that advised
Additionally, we identified that states may have ETA to establish methods to detect and
inadvertently applied a racial or gender bias recover improper payments, including fraud,
when providing benefits to claimants and did and reported on the PUA program, which
not provide adequate protections for claimants’ posed a significant risk to the UI system.
personal data. Facial recognition can serve PUA’s expanded coverage, for a population
as an effective tool in preventing fraudulent of claimants who were traditionally ineligible
payments. However, ETA and states need to receive UI benefits,53 presented significant
to implement proper oversight mechanisms. challenges to states. Further, we found the risk
47 COVID-19: ETA and States Did Not Protect Pandemic-Related UI Funds from Improper Payments including Fraud
or from Payment Delays, Report No. 19-22-006-03-315 (September 30, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2022/19-22-006-03-315.pdf
48 Based on OIG analysis of data on ETA’s public reporting on States’ UI Benefit Timeliness and Quality, available
at: https://oui.doleta.gov/unemploy/btq.asp
49 Founded in 1901, the National Institute of Standards and Technology is a physical sciences laboratory and non
regulatory agency under the U.S. Department of Commerce.
50 National Institute of Standards and Technology, “National Institute of Standards and Technology Study Evaluates
Effects of Race, Age, Sex on Face Recognition Software” (December 19, 2019), available at:
https://www.nist.gov/news-events/news/2019/12/nist-study-evaluates-effects-race-age-sex-face-recognition-software
51 An algorithm can be defined as a set of mathematical instructions or rules that, especially if given to a computer,
will help to calculate an answer to a problem.
52 Alert Memorandum: ETA and States Need to Ensure the Use of Identity Verification Service Contractors Results
in Equitable Access to UI Benefits and Secure Biometric Data, Report No. 19-23-005-03-315 (March 31, 2023),
available at: https://www.oig.dol.gov/public/reports/oa/2023/19-23-005-03-315.pdf
53 The new PUA program extended unemployment benefits to the self-employed, independent contractors, those
with limited work history, and other individuals not traditionally eligible for unemployment benefits who were unable
to work as a direct result of COVID-19.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 39
Worker and Retiree Benefit Programs
of improper payments including fraud was even History of Improper Payments,
higher under PUA because claimants could including Fraud
selfcertify their eligibility for benefits.
For over 20 years, the OIG has reported on
Moreover, in an effort to expeditiously and weaknesses in the Department’s ability to
efficiently provide UI benefits, states improperly measure, report, and reduce improper payments
paid billions of dollars. In May 2021, ETA in the UI program, which has experienced
provided guidance to states on the waiving of some of the highest improper payment rates
recovery of overpayments when the claimant across the federal government. The reported
was without fault and if the repayment would improper payment rate estimate for the regular
be contrary to equity and good conscience as UI program has been above 10 percent54 for
allowable by the CARES Act. This guidance 16 of the last 19 years.55
also outlined limited circumstances when the
states could use blanket waivers in lieu of The UI program requires states to make benefit
recovering overpayments. payments while ensuring claimants meet
eligibility requirements. A state may determine
As of September 30, 2023, states reported a payment is improper after a claimant receives
waiving recovery of more than $4.8 billion benefits based on new information that was
in overpayments for the three key CARES unavailable when the benefit payment was
Act programs: PUA, FPUC, and PEUC. approved or as a result of the requirement that
claimants be provided with due process prior to
In Spring 2023, we started assessing the stopping payment of benefits.
effects of waivers and blanket waivers on the
recovery of UI overpayments, including fraud. Improper payments have largely resulted
While DOL provided guidance correctly stating from a combination of four primary causes.
recovery of fraudulent payments may not be First, some claimants fail to demonstrate
waived, we remain concerned that states that they meet their states’ requirements
may have unintentionally waived or will waive for searching for new jobs (work search).56
fraudulent payments. As of September 30, 2023, Second, some claimants continue to claim UI
states reported waiving recovery of more than benefits after returning to work or misreport
$4.8 billion in overpayments for the three key earnings (benefit year earnings). Third, some
CARES Act programs: PUA, FPUC, and PEUC.
54 To fully comply with the Payment Integrity Information Act of 2019, agencies must report an improper payment
rate of less than 10 percent for each program and activity for which an estimate was published.
55 UI improper payments data for FY 2004 through FY 2022 as reported to the Office of Management and Budget.
56 The Middle Class Tax Relief and Job Creation Act of 2012 requires that individuals receiving UI benefits must be
able to work, available to work, and actively seeking work, as a condition of eligibility for regular compensation for
any week. Accordingly, states generally require that unemployed workers demonstrate they were actively seeking
work. Work search overpayments occur when states pay UI claimants who do not comply with a state’s required
work search activities.
40 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
employers, or their third-party administrators, In congressional testimony in February 2023,60
fail to provide prompt and adequate we noted that more than $888 billion in total
information about why individuals left their federal and state UI benefits were paid for
employment (employee separation). Finally, benefit weeks during the UI pandemic period.61
some improper payments have been caused Applying the estimated 21.52 percent improper
by fraud, such as those arising from schemes payment rate to the approximate $888 billion
perpetrated during the pandemic.57 in pandemic UI expenditures, at least $191 billion
in pandemic UI payments could have been
Our recommendations have specifically included improperly paid, with a significant portion
the need for the Department to estimate attributable to fraud.
improper payments within federally funded
temporary emergency programs. In August
2020, we recommended58 ETA estimate the
improper payment rate for pandemic-related UI
programs. In December 2021, consistent with
our recommendation, ETA reported an improper
payment rate of 18.71 percent that it applied
to two of the three key pandemic UI programs,
PEUC and FPUC. Additionally, in December
2022, ETA reported an improper payment rate
estimate of 21.52 percent, which it also applied
to PEUC and FPUC.59
57 ETA has included fraud as an element of the leading causes rather than as a separate cause. From July 2016
to March 2020, the other three causes resulted in over $9 billion in improper payments. Of this total, more than
$3 billion was attributable to fraud. Since the pandemic started, fraud has significantly increased.
58 COVID-19: More Can Be Done to Mitigate Risk to Unemployment Compensation under the CARES Act, Report No.
19-20-008-03-315 (August 7, 2020), available at: https://www.oig.dol.gov/public/reports/oa/2020/19-20-008-03-315.pdf
59 In FY 2021, the Department found the PUA, PEUC, and FPUC programs to be susceptible to significant improper
payments. The Payment Integrity Information Act of 2019 and its implementing guidance in Appendix C to OMB
Circular A-123, Requirements for Payment Integrity Improvement, requires the Department to produce an improper
payment and unknown payment rate in the FY following the FY in which the risk assessment determination was
made. ETA’s reported improper payment rate estimate of 21.52 percent does not include the PUA program.
60 “The Greatest Theft of American Tax Dollars: Unchecked Unemployment Fraud,” Hearing, Statement for the
Record of Larry D. Turner, Inspector General, U.S. Department of Labor; House Committee on Ways and Means
(February 8, 2023), available at: https://www.oig.dol.gov/public/testimony/02082023.pdf
61 With the exception of PUA, for which claims could be backdated to January 27, 2020, we define the UI pandemic
period as March 27, 2020, through September 6, 2021. We also note that, according to ETA, it cannot provide final
total costs of the programs because states are still processing claims that were for weeks of unemployment prior to
expiration of the programs.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 41
Worker and Retiree Benefit Programs
The potential loss of $191 billion of taxpayer cannot be used to estimate the PUA
money highlights the urgent need for systemic fraud rate.
improvements. For perspective, $191 billion
could have provided more than $3.5 billion In the last 2 years, ETA estimated fraud rates
to each SWA toward ensuring preparedness of 8.57 percent and 7.73 percent, respectively.63
for emergencies, including modernizing UI Notably, neither of these rates included PUA.
IT systems, enhancing staffing levels, and The fraud rate—which is a subset of the
formulating robust contingency plans. To recover improper payment rate—for pandemic-related
the improperly paid benefits and mitigate the UI programs was likely higher than the fraud
impact of these losses, collaboration between rate for regular UI programs. In fact, in the first
ETA and the states is vital. These issues have 6 months after the CARES Act passed, we
persisted after the pandemic; the OIG is seeing, found 4 states paid $1 out of every $5 in PUA
and ETA and states are still reporting, elevated benefits to likely fraudsters. In 2023, GAO
levels of improper payments in the UI program. estimated the pandemic-related fraud rate,
including PUA, was 11 to 15 percent for the
Also, based on audit and investigative work, period April 2020 to May 2023, and estimated
the improper payment rate for pandemic-related up to $135 billion was lost to fraud.64
UI programs was likely higher than 21.52 percent.
For example, ETA’s previously reported We continue to review and evaluate improper
improper payment rate estimates have not payment rate estimates.65 Estimating the
included the PUA program. In August 2023, improper payment rate for all emergency UI
the Department reported that the PUA programs is critical for the efficient operation
program had a total improper payment rate of the program. ETA and the states, under
of 35.9 percent.62 According to ETA officials, their program operating responsibilities, must
the small-scale review used to calculate the determine the improper payment rate, including
improper payment rate estimate for PUA the fraud rate, for pandemic UI programs.
62 This breakdown includes an overpayment rate of 17 percent, an underpayment rate of 1.5 percent, and a
17.4 percent rate for benefits whose classification—whether valid, overpaid, or underpaid—could not be determined.
This information was reported in ETA’s report, “Pandemic Unemployment Assistance Improper Payment Rate
Report” (August 21, 2023), last accessed October 13, 2023, available at:
https://oui.doleta.gov/unemploy/improp_pay.asp#.
63 ETA estimated the fraud rate as part of their Benefit Accuracy Measurement system reporting for the
program years July 1, 2020, through June 30, 2021, and July 1, 2021, through June 30, 2022. The Benefit
Accuracy Measurement system is designed to determine the accuracy of paid and denied claims in three major
UI programs: regular State UI, Unemployment Compensation for Federal Employees, and Unemployment
Compensation for Ex Servicemembers.
64 GAO, Unemployment Insurance: Estimated Amount of Fraud during Pandemic Likely between $100 Billion and
$135 Billion, GAO-23-106696 (September 2023), available at: https://www.gao.gov/assets/gao-23-106696.pdf
65 At the time of the publication of this semiannual report, the OIG has not audited the reported PUA improper
payment rate. The OIG will assess that rate’s compliance with the Payment Integrity Information Act of 2019 for
Fiscal Year 2023. That audit report will be available in Summer 2024.
42 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
A Perfect Storm provided additional weeks of unemployment
compensation. Also, certain UI claims could
Following the start of the pandemic in the be backdated to the beginning of the eligibility
United States in early 2020, unemployment period. With the legislative extensions, claimants
compensation claims rose exponentially to could receive up to 79 weeks of pandemic-related
historically unprecedented levels. Prior to the UI payments.
pandemic, numbers of UI claims were historically
low. On March 14, 2020, the Department In June 2020, the Inspector General provided
reported 282,000 initial unemployment claims. a member briefing68 and a statement for the
Within 2 to 3 weeks, initial claims rose to record69 to Congress highlighting challenges
10 times pre-pandemic levels, far higher than DOL and states faced in administering and
state systems were designed to handle.66 overseeing the UI program as well as the
Within 5 months, through August 15, 2020, the substantially increased fraud risk. The expanded
Department reported more than 57 million initial coverage offered under the PUA program
claims, the largest increase since the Department posed significant challenges to states as they
began tracking UI data in 1967. implemented processes to determine initial and
continued program eligibility for participants.
The CARES Act provided significant funding The CARES Act initially allowed reliance
to the UI program, which resulted in hundreds solely on claimant self-certifications without
of billions of dollars in additional payments. documentation substantiating the individual’s
New UI programs under the CARES Act meant prior employment or self-employment. This
more workers qualified.67 Further, unemployed initial reliance during PUA’s first 9 months
workers received a supplemental payment rendered the program particularly susceptible
for certain weeks in addition to their regular to improper payments, including fraud. In
benefit amount and individuals who exhausted March 2022 before the U.S. Senate Committee
their regular unemployment benefits were on Homeland Security and Governmental
66 COVID-19: States Struggled to Implement CARES Act Unemployment Insurance Programs, Report No.
19-21-004-03-315 (May 28, 2021), available at: https://www.oig.dol.gov/public/reports/oa/2021/19-21-004-03-315.pdf
67 The PUA program covered workers not typically covered by UI who could self-certify that they were able to and
available for work but unemployed due to COVID-19-related reasons.
68 “Subcommittee on Government Operations Briefing with the Inspector General for the Department of Labor,”
Member Briefing, Opening Statement of Scott S. Dahl, Inspector General, U.S. Department of Labor; House
Committee on Oversight and Reform; Subcommittee on Government Operations (June 1, 2020), available at:
https://www.oig.dol.gov/public/testimony/20200601.pdf
69 “Unemployment Insurance during COVID-19: The CARES Act and the Role of Unemployment Insurance During
the Pandemic,” Hearing, Statement for the Record of Scott S. Dahl, Inspector General, U.S. Department of Labor;
Senate Committee on Finance (June 9, 2020), available at: https://www.oig.dol.gov/public/testimony/20200609.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 43
Worker and Retiree Benefit Programs
Affairs,70 in February 2023 before the was filed from a 3-bedroom house shared the
U.S. House Committee on Ways and Means71 same physical address as 90 other claims and
and in March 2023 before the U.S. House used the same email address as 145 other
Committee on Oversight and Accountability,72 claims.73 In total, the likely fraudster(s) received
the Inspector General provided oral and written more than $1.5 million in unemployment
testimony that spoke to the continuation of many benefits. In the same audit, we found that, from
of these concerns and challenges. March 28, 2020, to September 30, 2020, in
4 states, potentially fraudulent claims were paid
During his March 2022 and March 2023 more than 60 percent of the time.
congressional testimonies, Inspector General
Larry D. Turner reported that the unprecedented As previously mentioned, PUA had control
infusion of federal funds into the UI program weaknesses that may have facilitated
combined with continuing program weaknesses comparable or greater improper payments.
and easily attainable stolen PII provided a During the program’s first 9 months, PUA
high-value target for fraudsters to exploit. Because claimants did not have to provide evidence
some states were not prepared to process the of earnings and states relied on claimant
extraordinary volume of new UI claims and self-certifications of eligibility. We found the
struggled to implement the new programs, some inclusion of self-certification allowed states to
controls were not initially implemented. streamline the payment process and deliver
assistance to those in need. However, it also
For example, an individual could make a rendered the program particularly susceptible to
fraudulent claim with relatively low risk of being improper payments, including fraud.
caught and, as time went on, one fraudster
could have been issued several UI debit cards, Subsequent to our work identifying the fraud
with tens of thousands of dollars on each card. risks, Congress took action under the Continued
In fact, in a later audit, we found 1 claim that Assistance for Unemployed Workers Act of
70 “Pandemic Response and Accountability: Reducing Fraud and Expanding Access to COVID-19 Relief through
Effective Oversight,” Hearing, Statement for the Record of Larry D. Turner, Inspector General, U.S. Department of
Labor; Senate Committee on Homeland Security and Governmental Affairs (March 17, 2022), available at:
https://www.oig.dol.gov/public/testimony/20220317.pdf
71 “The Greatest Theft of American Tax Dollars: Unchecked Unemployment Fraud,” Hearing, Statement for the
Record of Larry D. Turner, Inspector General, U.S. Department of Labor; House Committee on Ways and Means
(February 8, 2023), available at: https://www.oig.dol.gov/public/testimony/02082023.pdf
72 “Waste, Fraud, and Abuse Go Viral: Inspectors General on Curing the Disease,” Hearing, Statement for the
Record of Larry D. Turner, Inspector General, U.S. Department of Labor; House Committee on Oversight and
Accountability, Subcommittee on Government Operations and the Federal Workforce (March 9, 2023), available at:
https://www.oig.dol.gov/public/testimony/03092023.pdf
73 COVID-19: ETA and States Did Not Protect Pandemic-Related UI Funds from Improper Payments including Fraud
or from Payment Delays, Report No. 19-22-006-03-315 (September 30, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2022/19-22-006-03-315.pdf
44 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
some states with the PUA forms that claimants
used to certify their continuing eligibility for
UI benefits. ETA notified one state in June
2020 that its form did not include the required
questions confirming that claimants are able and
available to work. However, by then, that state
had paid more than $4 billion in PUA benefits,
including FPUC. Similarly, in July 2020, ETA
notified another state that its PUA monetary
determination form did not have a procedure in
place for re-determining the claimant’s weekly
benefit if the claimant did not provide proof of
earnings or provided insufficient proof. That state
Over 70 debit and credit cards seized during a responded that the problem would be addressed
search warrant. The subject had applied for the by the end of August 2020. However, by the
cards in other people’s names and at least 20 were end of August, that state had paid more than
UI debit cards. The investigation involved over $25 billion in PUA benefits, including FPUC.
$500,000 in fraudulent unemployment claims.
When the OIG identifies anti-fraud measures
2020 to require supporting documentation from
that may help the program, we share them with
claimants to improve states’ abilities to ensure
the Department and SWAs as appropriate.
proper claimant eligibility and to mitigate fraud.
For example, we have published four alert
However, a significant amount of UI benefits had
memoranda74 on specific high-risk areas. As of
already been paid to likely fraudsters.
September 2023, our investigators, auditors,
and data scientists have collaboratively
For instance, despite ETA providing states
identified $46.9 billion in potentially fraudulent
guidance on areas of improper payments as
UI benefits paid from March 2020 to April 2022
early as May 2020, control issues occurred in
74 (1) Alert Memorandum: The Employment and Training Administration (ETA) Needs to Ensure State Workforce
Agencies (SWA) Implement Effective Unemployment Insurance Program Fraud Controls for High Risk Areas,
Report No. 19-21-002-03-315 (February 22, 2021), available at:
https://www.oig.dol.gov/public/reports/oa/2021/19-21-002-03-315.pdf;
(2) Alert Memorandum: The Employment and Training Administration Needs to Issue Guidance to Ensure State
Workforce Agencies Provide Requested Unemployment Insurance Data to the Office of Inspector General,
Report No. 19-21-005-03-315 (June 16, 2021), available at:
https://www.oig.dol.gov/public/reports/oa/2021/19-21-005-03-315.pdf;
(3) Alert Memorandum: Potentially Fraudulent Unemployment Insurance Payments in High-Risk Areas Increased to
$45.6 Billion, Report No. 19-22-005-03-315 (September 21, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf; and
(4) Alert Memorandum: ETA Needs to Incorporate Data Analytics Capability to Improve Oversight of the
Unemployment Insurance Program, Report No. 19-23-012-03-315 (September 25, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-012-03-315.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 45
Worker and Retiree Benefit Programs
in the now six specific high-risk areas,75 to and are working to share data supporting the
individuals with Social Security numbers: additional high-risk areas. We recommended
states establish effective controls to mitigate
1. filed in multiple states, fraud and other improper payments to ineligible
2. of federal prisoners, claimants and are examining whether states
took effective measures to address the initial
3. used to file for UI claims with suspicious
four high-risk areas.
email accounts,
4. of deceased persons,
OIG Pandemic Investigative Work
5. belonging to individuals under 14 years of
age, and The volume of UI investigative matters is
6. belonging to individuals 100 years of age or unprecedented in the OIG’s history. Prior to
older (see Table 2). the pandemic, the OIG opened approximately
100 UI investigative matters annually. Since
For the first four high-risk areas, we have April 1, 2020, the OIG has opened over
shared our methodology and underlying data 205,000 investigative matters involving the
with DOL for further dissemination to the SWAs UI program, of which approximately 166,000
Table 2: Potential Fraud in Six High-Risk Areas, March 2020‒April 2022
High-Risk Area Total Number of Claimants* Total Potential Fraud Identified
Multistate Claimants 2,011,191 $28,967,047,154
Deceased Persons 205,494 $139,483,136
Federal Prisoners** 46,985 $267,382,013
Suspicious Emails 2,281,136 $16,265,578,304
Under Age 14 45,594 $1,225,663,851
Age 100 or Older 4,895 $66,541,872
Totals*** 4,595,295 $46,931,696,330
*Claimants can represent more than one claim.
**Federal prisoner data was only available for analysis for the period March 2020 through October 2020.
***Totals do not include duplicates that were identified in one or more areas.
Source: OIG analysis of data from SWAs, DOJ, Federal Bureau of Prisons, and the U.S. Social Security Administration.
75 Previously, we have reported on four high-risk areas; we added two areas: individuals with Social Security
numbers belonging to persons under 14 and over 100 years of age.
46 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
are still under review. That is a thousandfold • established a multi-disciplinary Pandemic
increase in the volume of UI work. UI Rapid Response Team within the OIG;
investigations now account for approximately • appointed a National UI Fraud Coordinator to
97 percent of the OIG investigative case manage our national investigative response
inventory, compared to approximately 11 percent to UI fraud;
prior to the pandemic.
• appointed seven Regional UI Fraud
Coordinators to partner with SWAs and
In response to the extraordinary
federal, state, and local law enforcement
increase in oversight demands, the OIG:
on UI fraud matters in their geographic
hired additional criminal investigators,
areas of responsibility;
increased the caseload of investigators
already onboard, deployed staff to review • leveraged resources from the Council of the
DOL and SWAs’ efforts, and strengthened Inspectors General on Integrity and Efficiency,
our data analytics program. Pandemic Response Accountability
Committee (PRAC);
In response to the extraordinary increase in • collaborated with state auditors to help
oversight demands, the OIG: hired additional develop their audit strategies for the CARES
criminal investigators, increased the caseload Act UI programs;
of investigators already onboard, deployed
• joined the DOJ COVID-19 Fraud Enforcement
staff to review DOL and SWAs’ efforts, and
Task Force;77
strengthened our data analytics program.
In addition, we took several other actions to • implemented an extensive outreach and
augment our efforts, including the following: education program targeted to SWAs, the
Department, financial institutions and their
• initiated the development of a National UI
associations, law enforcement agencies, and
Fraud Task Force,76 alongside DOJ;
the public. The program raised awareness
• collaborated with DOJ on the strategic about fraud trends, best practices, red flags,
assignment of 12 term-appointed Assistant and more;78
United States Attorneys assigned solely to
prosecute UI fraud;
76 More information on the National UI Fraud Task Force is available at:
https://www.justice.gov/coronavirus/national-unemployment-insurance-fraud-task-force.
77 DOJ Office of Public Affairs, “Attorney General Announces Task Force to Combat COVID-19 Fraud,” press release
(May 17, 2021), available at: https://www.justice.gov/opa/pr/attorney-general-announces-task-force-combat-covid-19-fraud
78 For example, the OIG has issued or assisted in issuing the following alerts: UI fraud consumer protection guide,
UI fraud investigations guide, UI fraud alert for state/local law enforcement, UI text message phishing alert, UI fraud
and phishing alert, UI fraud and identity theft alert, and UI detection and mitigation alert for financial institutions.
These are available at: https://www.oig.dol.gov/OIG_Pandemic_Response_Portal.htm.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 47
Worker and Retiree Benefit Programs
• joined DOJ’s Pandemic Fraud Strike Force 950 convictions; 19,000 months of incarceration;
Teams initiative;79 and and over $1 billion in investigative monetary
• engaged with foreign law enforcement results. We have also referred over 45,000 fraud
partners and agencies to raise awareness of matters that do not meet federal prosecution
American pandemic-related UI fraud issues guidelines back to the states for further action.
and establish ongoing collaboration.
In one recent investigation, the primary defendant
As the primary federal law enforcement in the case, a former federal employee, was
agency responsible for providing oversight sentenced to 192 months of federal incarceration
of the UI program, the OIG has vigorously for her role in a mail/wire fraud conspiracy, plus
pursued pandemic-related UI fraud. In fact, in an additional 24 months of incarceration for
September 2022, the OIG announced80 that its aggravated identity theft. The defendant was
investigations have resulted in more than 1,000 convicted for her role in a conspiracy to defraud
individuals being charged with crimes involving at least 5 SWAs of more than $3.5 million in
UI fraud since March 2020. Since then, that pandemic-related UI benefits. To obtain these UI
number has risen.81 benefits, the defendant and others filed false and
misleading applications in the names of identity
As the primary federal law enforcement theft victims, co-conspirators, and inmates
agency responsible for providing oversight of state and federal prisons. Among other
of the UI program, the OIG has vigorously information, the defendant and her
pursued pandemic-related UI fraud. co-conspirators included in these applications
materially false wage and employment
As of September 2023, our pandemic histories and contact information that did not,
investigations have resulted in upwards of in fact, belong to the purported applicants. The
850 search warrants executed and over defendant was ordered by the court to pay more
1,550 individuals charged with crimes related to than $2 million in restitution, jointly and severally
UI fraud. These charges resulted in more than: with 3 other convicted codefendants. The court
also ordered forfeiture in the amount of over
79 The OIG joined DOJ and other federal law enforcement partners as participants on the DOJ’s COVID-19 Fraud
Strike Force Teams initiative, announced on September 14, 2022. These Strike Force teams operated out of U.S.
Attorneys’ Offices in the Southern District of Florida, the District of Maryland, and a joint effort between the Central
and Eastern Districts of California. They used dedicated special agents from the OIG to focus on significant fraud
schemes with an international nexus. DOJ, “Department Announces COVID-19 Fraud Strike Force Teams,” press
release (September 14, 2022), available at: https://www.justice.gov/opa/pr/justice‑department‑announces‑covid‑19-
fraud-strike-force-teams department announces COVID-19-fraud-strike-force-teams
80 “Labor Watchdog’s Pandemic Work Results in More Than 1,000 Individuals Charged with UI Fraud and $45.6
Billion Identified in Potentially Fraudulent Pandemic UI Benefits,” press release (September 22, 2022), available at:
https://www.oig.dol.gov/public/Press%20Releases/DOL-OIG%20Pandemic%20Work%20Results%20in%20More%20
Than%201000%20Individuals%20Charged%20with%20UI%20Fraud.pdf
81 For more details about OIG investigations, visit our Pandemic Response Portal at:
https://www.oig.dol.gov/OIG_Pandemic_Response_Portal.htm.
48 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
Working with Domestic and
International Law Enforcement Partners
Early in the pandemic, the OIG worked with the
DOJ to create the National UI Fraud Task Force,
a nine-agency federal task force focused on law
enforcement intelligence sharing, deconfliction,
joint national messaging, and the effective use
of investigative and prosecutorial resources.
The National UI Fraud Task Force has also
worked closely with partners at the International
Organized Crime Intelligence and Operations
During the execution of a search warrant, OIG agents Center (IOC-2) to develop a deconfliction
discovered evidence of unemployment fraud and process to coordinate investigative information
significant drug paraphernalia. The investigation is across federal law enforcement agencies.
associated with approximately $1.3 million in fraud.
$1.6 million, which represents the specific amount Through data analytics and a leads generation
of fraudulent UI benefits directly attributable to process, the National UI Fraud Task Force
the defendant, for which she is solely liable. and IOC-2 partner agencies have identified
significant fraud committed against the UI
In another OIG investigation, a defendant was program by domestic and international criminal
sentenced to 92 months of federal incarceration organizations. Many of these include street-level
for his role in a scheme involving the possession criminal organizations with ties to illegal guns
of 15 or more access devices82 and possession and drugs. These investigations are ongoing
of a firearm by a convicted felon. Additionally, he and actively being investigated through the
was sentenced to 24 more months of consecutive National UI Fraud Task Force, the COVID-19
incarceration for aggravated identity theft. Fraud Enforcement Task Force, and the
The investigation revealed that the defendant COVID-19 Fraud Strike Force Teams initiative.
possessed the identities of approximately 72
identity theft victims and he used those identities The OIG has been very engaged on DOJ’s
to apply for UI benefits in 25 states. The court COVID-19 Fraud Enforcement Task Force.
also ordered the defendant to pay restitution in We have representation on its subcommittees
the amount of $491,074 to 15 SWAs. involving communication, forfeiture,
corporations and large business fraud, and
82 Pursuant to 18 U.S.C. § 1029, the term “access device” means any card, plate, code, account number, electronic
serial number, mobile identification number, personal identification number, or other telecommunications service,
equipment, or instrument identifier, or other means of account access that can be used, alone or in conjunction with
another access device, to obtain money, goods, services, or any other thing of value, or that can be used to initiate a
transfer of funds (other than a transfer originated solely by paper instrument).
Semiannual Report to Congress | April 1, 2023–September 30, 2023 49
Worker and Retiree Benefit Programs
data, and we co-chair the task force’s Criminal The OIG and its law enforcement partners are
Enterprise Subcommittee. working with hundreds of financial institutions in
response to our request.
The OIG has also participated in other initiatives.
For example, since 2020, the OIG has supported The OIG has also conducted extensive
DOJ’s annual Money Mule Initiative,83 which engagement with foreign law enforcement
aimed to raise awareness about and suppress partners, including the European Union
money mule activity. Money mules are people Agency for Law Enforcement Cooperation,85
who, at someone else’s direction, receive and International Criminal Police Organization,86
move money obtained from victims of fraud. The and other national law enforcement agencies.
OIG conducted extensive internal and external These efforts focused on introducing foreign
outreach regarding money mules and identified partners to the OIG’s mission, briefing partners
and targeted money mules in coordination with on pandemic fraud trends, and collaborating to
DOJ and other partner agencies. examine the movement of pandemic-related UI
funds transnationally.
In addition, the OIG issued alerts to financial
institutions about UI fraud both on its own and The PRAC has also played a pivotal role
jointly with its partners, such as the U.S. Secret in amplifying the ability of OIGs to share
Service (Secret Service), the Financial Crimes information and conduct internal and external
Enforcement Network, and the National UI outreach to stakeholders that have been
Fraud Task Force. One such joint OIG/Secret impacted by pandemic fraud. For example, the
Service alert84 served as a framework for the OIG worked with the PRAC on social media
recovery of millions of dollars of fraudulent UI tool kits related to money mule activity and
funds being held by financial institutions. Later, erroneous 1099-G forms that were issued to
in 2021, the OIG authored a National UI Fraud victims of UI fraud. The OIG has also worked
Task Force alert issued through the Financial with the PRAC, DOJ, and the Secret Service
Crimes Enforcement Network to financial to create a web-based survey where financial
institutions requesting they identify funds they institutions can more broadly report UI and
froze due to suspicion of fraud. The OIG created other types of pandemic fraud. This information
a process with DOJ and the Secret Service to is being collected by the PRAC, analyzed by
collect that data and work with those financial its partners, and, if appropriate, sent to field
institutions to return fraudulent funds to SWAs. personnel for further action.
83 More information about DOJ’s Money Mule Initiative is available at:
https://www.justice.gov/civil/consumer-protection-branch/money-mule-initiative.
84 Secret Service and OIG, “Detection and Mitigation of Unemployment Insurance Fraud Guidance for Financial
Institutions,” July 6, 2020, available at:
https://www.neach.org/Portals/0/USSS-DOL%20OIG%20UI%20Advisory%207_6_2020.pdf
85 Commonly known as “EUROPOL”
86 Commonly known as “INTERPOL”
50 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
The OIG, through its membership in IOC-2, OIG Pandemic Oversight Work
has also been engaged with several allied
national law enforcement agencies to strategize In April 2020, shortly after CARES Act
about pandemic-related fraud and how to best enactment, we published our Pandemic
establish practices to share information. Response Oversight Plan detailing how the
The issue of pandemic fraud has not only OIG would conduct its pandemic oversight,
been an issue for the United States, but it has with a significant focus on the UI program.
also negatively impacted our foreign partners’ We designed our four-phased plan to provide
pandemic programs. We have conducted recommendations to DOL to address current
outreach and education related to pandemic and emerging vulnerabilities with the pandemic
fraud, including UI fraud, with our Five Eyes response and to prevent similar vulnerabilities
partner countries as participants on the from hampering preparedness for future
International Public Sector Fraud Forum.87 emergencies (see Figure 4).
The OIG, IOC-2, and our federal law
enforcement partners have identified During Phases 1 and 2, which are complete,
numerous instances of international organized we reviewed DOL’s plans, guidance, and
criminal groups engaged in UI fraud. We initial implementation, highlighting significant
will continue to work with our domestic and vulnerabilities. During Phase 3, which is
international law enforcement partners on ongoing, we are taking a deep dive into key
these matters.
Figure 4: The OIG’s Four-Phased Design for Pandemic Oversight
Source: OIG Pandemic Response Oversight Plan
87 Five Eyes is an intelligence alliance. The Five Eyes countries include Australia, Canada, New Zealand, the
United Kingdom and the United States. The International Public Sector Fraud Forum consists of representatives
from organizations from the Five Eyes countries, whose collective aim is to share best and leading practices in fraud
management and control across public borders. International Public Sector Fraud Forum guidance is available at:
https://www.gov.uk/government/publications/international-public-sector-fraud-forum-guidance.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 51
Worker and Retiree Benefit Programs
and emerging issues. Our Phase 4 work plans program,89 and we assessed comparable
include reporting on lessons learned for UI, lessons learned. As a result, in April 2020, we
worker safety and health, and employment issued the previously noted advisory report90
training and recovery from the overall toll on identifying six initial areas of concern for ETA
workers since COVID-19 first appeared in the and the states to consider while implementing
United States. Based on the work performed CARES Act UI provisions:
under this oversight plan, we continue to 1. state preparedness, specifically the issues of
make recommendations for DOL to strengthen staffing and system capabilities,
and enhance programs prior to the start of
2. initial eligibility determination,
emergencies. We published two plan updates
and one revision.88 3. benefit amount,
4. return to work,
5. improper payment detection and recovery, and
6. program monitoring.
Our identification of these areas represents
years of work relating to DOL’s UI program,
including the use of prior stimulus funds and
response to past disasters. The advisory
report outlined years of weaknesses and
recommendations identified by the OIG to
strengthen the UI program. Many of the
weaknesses previously identified became once
again apparent during the pandemic. DOL and
At the start of the pandemic, we examined past states must apply lessons learned to correct
audits, including those related to the Recovery additional weaknesses identified prior to the
Act and the Disaster Unemployment Assistance next disaster.
88 Pandemic Response Oversight Plan, Revised June 30, 2023, available at:
https://www.oig.dol.gov/public/oaprojects/2023%20Revised%20Pandemic%20Response%20Oversight%20Plan.pdf
89 Examples include: Recovery Act: DOL Could Have Better Monitored the Use of Re-employment Services Funds
to Adhere to Standards for Transparency and Accountability, Report No. 18-11-005-03-315 (March 31, 2011),
available at: https://www.oig.dol.gov/public/reports/oa/2011/18-11-005-03-315.pdf; Recovery Act: States Challenged
in Detecting and Reducing Unemployment Insurance Improper Payments, Report No. 18-16-005-03-315
(August 2, 2016), available at: https://www.oig.dol.gov/public/reports/oa/2016/18-16-005-03-315.pdf; and Audit of
Florida Disaster Unemployment Assistance Grant Number 1359 - DR (March 26, 2004), Report No. 04-04-004-03-
315 (March 26, 2004), available at: https://www.oig.dol.gov/public/reports/oa/2004/04-04-004-03-315.pdf.
90 Advisory Report: CARES Act: Initial Areas of Concern Regarding Implementation of Unemployment Insurance
Provisions, Report No. 19-20-001-03-315 (April 21, 2020), available at:
https://www.oig.dol.gov/public/reports/oa/2020/19-20-001-03-315.pdf
52 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
We have issued several subsequent reports, pandemic UI programs that posed the
including alert memoranda addressing urgent greatest risk for fraud, waste, and abuse:
concerns, involving the UI program, such as PUA, PEUC, and FPUC. Specifically, DOL’s
the following: guidance and oversight did not ensure
• In May 2020, we issued an alert states: implemented the programs and
memorandum91 describing our concerns paid benefits promptly, performed required
regarding claimant self-certification in the and recommended improper payment
PUA program. In our view, reliance on such detection and recovery activities, or reported
self-certifications rendered the PUA program accurate and complete program activities.
highly vulnerable to improper payments This occurred primarily because states’
including fraud. Subsequent to our work, IT systems were not modernized, staffing
Congress took action to require claimants resources were insufficient to manage
to submit documentation substantiating the increased number of new claims, and,
employment or self-employment to improve according to state officials, ETA’s guidance
states’ abilities to ensure proper claimant was untimely and unclear.
eligibility and to mitigate fraud through the • In November 2021, we issued94 the
Continued Assistance for Unemployed Department a qualified opinion, for the first
Workers Act of 2020. time in 25 years, on its consolidated financial
• In August 2020, we reported92 states did not statements and reported one material
use existing tools effectively to combat fraud weakness related to pandemic-related UI
and other improper payments. We also stated funding. There were two primary causes for
ETA should work with the OIG to obtain access this issue: (1) the Department being unable
to state claimant data that could be used to to support more than $47 billion it estimated
identify and disrupt fraudulent schemes that for UI claims in appeal or unprocessed as
threaten the integrity of UI programs, including of September 30, 2021, and (2) unreliable
those under the CARES Act. reporting of more than $4 billion in UI benefit
overpayments due to certain states’
• In May 2021, we reported93 that DOL and
non-reporting of UI overpayment activity.
states struggled to implement the three
91 Alert Memorandum: The Pandemic Unemployment Assistance Program Needs Proactive Measures to Detect and
Prevent Improper Payments and Fraud, Report No. 19-20-002-03-315 (May 26, 2020), available at:
https://www.oig.dol.gov/public/reports/oa/2020/19-20-002-03-315.pdf
92 COVID-19: More Can Be Done to Mitigate Risk to Unemployment Compensation Under the CARES Act,
Report No. 19-20-008-03-315 (August 7, 2020), available at:
https://www.oig.dol.gov/public/reports/oa/2020/19-20-008-03-315.pdf
93 COVID-19: States Struggled to Implement CARES Act Unemployment Insurance Programs,
Report No. 19-21-004-03-315 (May 28, 2021), available at:
https://www.oig.dol.gov/public/reports/oa/2021/19-21-004-03-315.pdf
94 FY 2021 Independent Auditor’s Report on the DOL Financial Statements, Report No. 22-22-003-13-001
(November 19, 2021), available at: https://www.oig.dol.gov/public/reports/oa/2022/22-22-003-13-001.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 53
Worker and Retiree Benefit Programs
• In July 2022, we reported95 that the reported zero overpayments for the PUA
Department did not meet the requirements program. This lack of accurate state
for compliance with the Payment Integrity performance information hinders Congress
Information Act of 2019 (PIIA) for FY 2021. and ETA’s ability to: assess state activities,
PIIA requires federal agencies to identify mitigate overpayments risks, identify
programs susceptible to significant improper program weaknesses, and improve future
payments, estimate the improper payments temporary programs.
for those programs, and report on actions • In September 2022, we reported97 ETA and
to reduce the improper payments in those states did not protect pandemic-related
programs. While DOL met three of the six UI funds from historic levels of improper
compliance requirements for UI programs, payments, including fraud, nor from
we found DOL did not meet the other three payment delays. We attributed this to four
requirements: it did not publish all improper causes: lack of eligibility testing, untimely
payment estimates, did not demonstrate oversight, PUA self-certification, and the
improvement from the improper target rate 3-month suspension of a primary oversight
published in FY 2020, and did not report tool. Additionally, DOL’s interpretation of
an improper payment rate of less than its regulations hindered the OIG’s timely
10 percent. and complete access to UI claims data
to assist in detecting and deterring fraud.
Our examination of required reports We estimated that, in the initial 6 months
identified that some states did not submit after the CARES Act passed, 4 states paid
reports to ETA or reported zero activity. $30.4 billion in PUA and FPUC benefits
improperly, including $9.9 billion paid to
likely fraudsters. Further, based on our
• In August 2022, we issued an alert
analysis of ETA’s timeliness reports, at least
memorandum96 about deficient reporting
6.2 million American workers nationwide
by states regarding the CARES Act UI
waited a month or more for pandemic-related
programs. Our examination of required
UI benefits during the year after the CARES
reports identified that some states did
Act passed.
not submit reports to ETA or reported
zero activity. For instance, seven states
95 The U.S. Department of Labor Did Not Meet the Requirements for Compliance with the Payment Integrity
Information Act for FY 2021, Report No. 22-22-007-13-001 (July 1, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2022/22-22-007-13-001.pdf
96 Alert Memorandum: The Employment and Training Administration Needs to Ensure State Workforce Agencies
Report Activities Related to CARES Act Unemployment Insurance Programs, Report No. 19-22-004-03-315
(August 2, 2022), available at:https://www.oig.dol.gov/public/reports/oa/2022/19-22-004-03-315.pdf
97 COVID-19: ETA and States Did Not Protect Pandemic-Related UI Funds from Improper Payments including Fraud
or from Payment Delays, Report No. 19-22-006-03-315 (September 30, 2022),
available at: https://www.oig.dol.gov/public/reports/oa/2022/19-22-006-03-315.pdf
54 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
• In December 2022, for the second straight technology have a racial and gender bias.
year, we issued98 the Department a qualified Furthermore, some states did not implement
opinion on its consolidated financial necessary privacy security measures
statements and reported one material recommended to protect UI claimants’
weakness related to pandemic-related UI biometric data. Less than a month after we
funding. There were two primary causes issued our report, ETA provided additional
for this issue: (1) the Department was guidance to states regarding biometrics and
unable to support $7.9 billion it estimated facial recognition.
in remaining pandemic-related UI claims in
appeal or unprocessed as of September 30,
2022, and (2) the Department was unable
to support the $3.5 billion it estimated in
remaining pandemic-related UI benefit
overpayment receivables.
• In March 2023, we issued an alert
memorandum99 about urgent equity and
security concerns in the UI program,
including facial recognition technology.
Resulting from the economic impact of the • In June 2023, we reported101 that, again,
pandemic, UI programs have become a DOL did not meet the requirements for
target for fraud with significant numbers compliance with PIIA for FY 2022. While
of imposter claims being filed with stolen DOL met four of the six compliance
or synthetic100 identities. Approximately requirements for UI excluding PUA, it did not
45 percent of states hired identity meet the other two: it did not demonstrate
verification service contractors that used improvement from the improper payment rate
facial recognition technology. The National published in FY 2021 and it did not report
Institute of Standards and Technology has an improper payment rate of less than 10
reported that it found empirical evidence the percent. For PUA, we reported DOL did not
algorithms used in current facial recognition meet four of the six compliance requirements
98 FY 2022 Independent Auditor’s Report on the DOL Financial Statements,
Report No. 22-23-002-13001 (December 13, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2023/22-23-002-13-001.pdf
99 Alert Memorandum: ETA and States Need to Ensure the Use of Identity Verification Service Contractors Results
in Equitable Access to UI Benefits and Secure Biometric Data, Report No. 19-23-005-03-315 (March 31, 2023),
available at: https://www.oig.dol.gov/public/reports/oa/2023/19-23-005-03-315.pdf
100 A synthetic identity is a false identity created from a combination of real and fake information.
101 The U.S. Department of Labor Did Not Meet the Requirements for Compliance with the Payment Integrity
Information Act for FY 2022, Report No. 22-23-006-13-001 (June 9, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/22-23-006-13-001.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 55
Worker and Retiree Benefit Programs
for the PUA program: it did not publish March 27, 2020, to September 6, 2021, the
improper payment estimates, programmatic OIG found that over 33,400 beneficiaries in
corrective action plans, reduction targets, these areas collectively received more than
and an improper payment rate. $516 million.
• In July 2023, we found102 ETA did not provide
adequate oversight of the emergency UI We found ETA needs to improve its
administrative grants. Specifically, ETA did oversight of the Integrity Data Hub.
not verify if states were qualified for the
grants before transferring all grant funds
• In September 2023, we issued104 a
to the states’ accounts. In our review of
memorandum reporting on three key matters
14 states, we found ETA qualified these
related to the National Association of State
states to receive more than $136 million
Workforce Agencies (NASWA) resulting from
in emergency administrative grant funds.
our audit of ETA’s oversight of UI integrity
Additionally, we found ETA could not provide
for three key CARES Act programs. We
reasonable assurance that states used
found ETA needs to improve its oversight
the emergency administrative grants to
of the Integrity Data Hub (IDH). ETA did not
administer UI programs. These funds were
ensure an initial assessment of NASWA’s
monitored through single audits that did not
IDH was performed in compliance with
disclose how states used the funds.
federal requirements, nor did ETA provide
• In July 2023, we released103 a memorandum documentation it evaluated NASWA’s
detailing our collaboration with the PRAC security assessment reports. Further,
to evaluate the federal government’s we found the IDH was less effective at
COVID-19 response in six local communities: identifying potentially improper multistate
Springfield, Massachusetts; Coeur d’Alene, claims when compared to the OIG’s data.
Idaho; Marion County, Georgia; Sheridan
• As of September 2023, we have issued four
County, Nebraska; White Earth Reservation
alert memoranda that identified a cumulative
in Minnesota; and Jicarilla Apache
total of $46.9 billion in potentially fraudulent
Reservation in New Mexico. Our assessment
UI benefits paid from March 2020 through
centered on DOL’s expanded UI benefits
April 2022 in the previously mentioned six
for pandemic-affected workers. From
specific high-risk areas.
102 ETA Did Not Provide Adequate Oversight of Emergency Administrative Grants,
Report No. 19-23-006-03-315 (July 27, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-006-03-315.pdf
103 Tracking the Department of Labor’s Unemployment Insurance Response to Local Communities During the
Pandemic, Report No. 19-23-007-03-315 (July 10, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-007-03-315.pdf
104 COVID-19 - ETA Can Improve its Oversight to Ensure Integrity over CARES Act UI Programs,
Report No. 19-23-011-03-315 (September 22, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-011-03-315.pdf
56 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
• In September 2023, we reported105 that overpayments in the PUA program, including
the EURGENO program should have been fraud, were caused by a combination of
better managed. EURGENO was designed allowing claimants to self-certify their eligibility
to mitigate the effects of the pandemic coupled with states’ difficulties implementing
on employers that reimburse the states new UI programs and meeting the substantial
for eligible UI benefits paid (reimbursing increase in claims volume.
employers). However, reimbursing employers • In September 2023, we reported107 ETA and
experienced delays in receiving pandemic states did not always meet the requirements
relief, waiting anywhere from a month or statutory intent of the TFFF program.
to more than a year. Additionally, states Specifically, individual claimants waited to
received funding for ineligible weeks and receive urgently needed UI benefits, states
amounts that were later determined to be received TFFF funding when they were not
ineligible. Consequently, these states owe eligible, and states’ TFFF accounts have
millions to the federal government, including unused fund balances. As of July 31, 2023,
approximately $29 million in questioned nearly $5 billion remained unused and
costs across the 6 states we tested. has not been reconciled, closed out for
• In September 2023, we reported106 that PUA deobligation, and returned to Treasury. These
for non-traditional claimants was weakened by issues occurred because ETA did not have
billions in overpayments, including fraud. From sufficient controls in place to ensure states
April 1, 2020, to March 31, 2023, the 53 SWAs accessing funds were in fact eligible for
reported nearly $35 billion in established reimbursements or that unused TFFF funds
PUA overpayments—benefit payments that were returned to the federal government.
SWAs investigated and found were improper. • In September 2023, we reported108 that ETA
In total, states reported that over 15 percent did not evaluate the capability of SWAs’ UI
of all PUA benefits paid were overpayments IT systems to successfully administer UI
and approximately 61 percent of all FPUC benefits. Further, ETA did not have sufficient
overpayments occurred when PUA was information to know which SWAs’ UI IT
the underlying benefit. The significant
105 COVID-19: Unemployment Relief For Governmental Entities and Nonprofit Organizations Should Have Been
Better Managed, Report No. 19-23-010-03-315 (September 21, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-010-03-315.pdf
106 COVID-19: Pandemic Unemployment Assistance for Non-Traditional Claimants Weakened by Billions in
Overpayments, including Fraud, Report No. 19-23-014-03-315 (September 27, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-014-03-315.pdf
107 COVID-19: ETA Needs a Plan to Reconcile and Return to the U.S. Treasury Nearly $5 Billion Unused by States
for a Temporary Unemployment Insurance Program, Report No. 19-23-015-03-315 (September 28, 2023), available
at: https://www.oig.dol.gov/public/reports/oa/2023/19-23-015-03-315.pdf
108 COVID-19: Audit of State Workforce Agencies’ Information Technology Systems Capability in Processing
Unemployment Insurance Claims, Report No. 19-23-008-03-315 (September 19, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-008-03-315.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 57
Worker and Retiree Benefit Programs
systems posed the greatest risk of failing OIG Recommendations to DOL
because they did not require SWAs to
develop UI IT modernization plans. Only 1 OIG Access to UI Claimant Data and
of the 10 SWAs we reviewed had developed Wage Records
or implemented UI IT modernization plans • Implement immediate measures to ensure
that improved the timeliness or accuracy ongoing OIG access to UI claimant
of UI benefits processing. Similarly, of the data and wage records for all audit and
38 SWAs we surveyed, only 14 reported investigative purposes
that they had implemented such plans.
Ensuring SWAs have these plans in place • Expedite regulatory updates to require
and are actively pursuing implementation ongoing disclosures of UI information to
would be a strong step toward ETA ensuring the OIG for all audits and investigations of
SWAs improve administration of benefits, federal programs
particularly during a future crisis.
Staffing and Systems for Prompt Payments
• In September 2023, we reported109 on our during Emergencies
Quality Control Review (QCR) of the single
audit performed by Scott and Company, LLC • Continue to work with states to develop,
for 2021 for one state. Our review focused on operate, and maintain a modular set of
the state’s $3.67 billion in UI expenditures. technological capabilities (i.e., staffing and
We found deficiencies in the firm’s: planning replacing legacy IT systems) to modernize the
and testing of UI, reporting on the lack of delivery of UI benefits to sufficiently manage
internal controls in the PUA program, and and process sudden spikes in claims volume
reporting the federal expenditures. during emergencies or high unemployment
• Conduct a study to assess:
OIG Recommendations ◦ the technological needs of the UI
programs to determine the capabilities
The OIG has made several recommendations that need to be upgraded or replaced,
to DOL and Congress to improve the efficiency ◦ the features necessary to effectively
and integrity of the UI program. While action has respond to rapid changes in the volume
been taken to resolve some recommendations, of claims in times of emergency or
further action is needed to close them. high unemployment,
Summaries of key recommendations that remain
open follow. Additionally, we have highlighted ◦ the capabilities needed to ensure effective
four high-priority recommendations for and equitable delivery of benefits, and
Congress at the end of the section. ◦ the capabilities to minimize fraudulent
activities
109 Quality Control Review Single Audit of South Carolina Department of Employment and Workforce for the Year
Ended June 30, 2021, Report No. 24-23-003-50-598 (September 26, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/24-23-003-50-598.pdf
58 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
Controls for Improper Payments amount of unused emergency UI funds to be
• Obtain direct access to UI claims data from returned to Treasury
all SWAs • Determine the proper disposition of excess
• Create an integrity program that: funds and take necessary actions, including
recovery of questioned costs
◦ incorporates a data analytics capability
and • Capture lessons learned for future programs
◦ regularly monitors state UI claims data to
Guidance and Assistance to States
detect and prevent improper payments,
including fraud, and to identify trends and • Assist states with claims, overpayment, and
emerging issues that could negatively fraud reporting to create clear and accurate
impact the UI program information. Then, use the overpayment and
fraud reporting to prioritize and assist states
• Establish effective controls, in collaboration
with fraud detection and recovery
with SWAs, to mitigate fraud and other
improper payments to potentially ineligible • Examine the effectiveness of the Benefit
claimants in high-risk areas, such as UI Accuracy Measurement system contact
benefits paid to individuals with Social verification process to ensure it reflects the
Security numbers filed in multiple states and current methods claimants use to seek work
belonging to deceased persons • Specify within ETA’s policy the information
• Include CARES Act UI transactions in the states must include in their documentation to
Benefit Accuracy Measurement110 system support compliance with the requirements to
or develop an alternative methodology to receive grant funds prior to disbursement of
reliably estimate improper payments for the funds
those programs
Coordination with Congress
• For DOL financial statements, design and
implement controls to ensure management’s • Work with Congress to establish legislation
reviews of UI program estimates are requiring SWAs to cross-match high-risk
performed at a sufficient level of detail and areas, such as UI benefits paid to individuals
adequate documentation is maintained to with Social Security numbers filed in multiple
assess the reasonableness of the estimates states and belonging to deceased persons
• Work with Congressional stakeholders
Reconciliation to inform them of the urgency of the
• Develop procedures and establish a deadline expiring statute of limitations concerning
to ensure reconciliation to determine the pandemic-related UI fraud
110 The Benefit Accuracy Measurement system, commonly known as BAM, is a quality control statistical survey
used to identify errors and support corrective action in the state UI system. The data are an estimate of the total
improper payments in the UI program, in each state and the nation as a whole, based on a statistically valid
examination of a sample of paid and denied claims.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 59
Worker and Retiree Benefit Programs
OIG Recommendations to Congress These legislative proposals are consistent
with previous OIG reporting to improve the
In addition, the OIG encourages Congress UI program.
to consider and adopt key DOL proposals
to aid the Department’s efforts to combat The OIG recommended that Congress
improper payments in the UI program. In its extend the statute of limitations for
FY 2024 Congressional Budget Justification,111 fraud involving pandemic-related UI
the Department proposed provisions designed programs, which will begin to expire in
to provide new and expanded tools and controls early 2025.
for states to help ensure workers are properly
paid and to prevent improper payments, The OIG has also recommended that Congress
including fraud in the UI system. ensure DOL and the OIG have ongoing,
timely, and complete access to UI claimant
The Department stated that the proposals data and wage records for our respective
collectively would result in savings of more oversight responsibilities. In addition, the
than $2 billion over the 10-year budget window. OIG recommended Congress authorize OIG
These are similar to DOL proposals included participation in asset forfeiture funds to combat
in prior DOL budget requests that would help UI fraud and other crimes.
address UI program integrity and the high
improper payment rates in the UI program. Further, in our Fall 2022 and Spring 2023
These proposals include the following: Semiannual Reports to Congress, the OIG
• require SWAs to cross-match UI claims recommended that Congress extend the
against the National Directory of New Hires; statute of limitations for fraud involving
pandemic-related UI programs, which will
• require SWAs to cross-match UI claims with begin to expire in early 2025. However, even
a system(s)…that contains information on if this statute of limitations is extended, the
individuals who are incarcerated; degree to which we can continue our level of
• require states to disclose information to the OIG; oversight work depends on the availability of
• allow SWAs to retain up to 5 percent of resources. We will continue to efficiently use
recovered fraudulent UI overpayments for our available resources for pandemic-related
program integrity use; audit and investigative efforts; however, at
current funding levels, resource limitations
• require SWAs to use [UI] penalty and interest
have resulted and will continue to result
collections solely for UI administration; and
in a substantial reduction of effort in
• permit the Department to collect and store pandemic-related oversight.
states’ UI claimant data.
111 U.S. Department of Labor, FY 2024 Congressional Budget Justification, Employment and Training
Administration, State Unemployment Insurance and Employment Service Operations, available at:
https://www.dol.gov/sites/dolgov/files/general/budget/2024/CBJ-2024-V1-07.pdf
60 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
Highlighted High-Priority implementing the pandemic-related UI
Recommendations for Congress programs. These efforts include measures
like secure sign-in services, in-person identity
1. Extend the statute of limitations for fraud verification, and a new identity fraud reporting
involving pandemic-related UI programs; website being introduced to mitigate fraud.
2. Ensure DOL and the OIG have ongoing, Specifically, in July 2023, DOL announced
timely, and complete access to UI claimant opportunities to strengthen ID verification,
data and wage records; subject to the availability of funds. Additionally,
3. Grant the OIG statutory authority to ETA made available up to $765 million in
participate in asset forfeiture funds to combat fraud prevention grants and expert Tiger
UI fraud and other crime; and Teams provided states with assessments
4. Ensure effective payment integrity controls and improvement recommendations for UI
to reduce improper payments in all UI processes. ETA also facilitated the secure
programs including temporary ones, such availability of incarceration data to cross-
as through broader requirements for reference UI claims against prisoner information.
mandatory cross-matching.
Further, ETA reported it continued to provide
DOL’s Progress oversight and technical assistance through
the State Quality Service Plans, the Integrity
The Department has emphasized the progress Action Plan, the UI Integrity Center, and
it has made in addressing challenges with the UI through information provided by the OIG.
program. According to DOL, one of the challenges ETA also stated it worked with the Office
associated with the pandemic-related UI programs of the Chief Financial Officer to develop
was that the programs did not include an adequate a UI fraud risk profile in line with GAO’s
preparation period. ETA officials stated a swift Fraud Risk Framework. In addition, in its
rollout of a new government benefit program, FY 2024 Congressional Budget Justification,
including policy formulation, product development, the Department proposed provisions designed
and operational procedures, typically requires a to provide new and expanded tools and
timeframe of 30 to 48 months. Unfortunately, the controls for states to help ensure workers
challenges associated with the pandemic-related are properly paid and to prevent improper
UI programs had to be resolved in real-time, payments, including fraud in the UI system.
while states grappled with an extraordinary
tenfold increase in claims volume. The The Department issued a policy granting
Department’s statements reinforce the OIG’s the OIG access to UI data for benefit weeks
position that the Department must be prepared covered by CARES Act programs and related
before disasters occur. extensions. ETA also announced its intent to
amend its regulations to facilitate the OIG’s
According to DOL, since the passage of the ongoing access by February 2025, and, in
CARES Act, ETA and states have instituted July 2023, requested public comment on
efforts to focus on program integrity when potential revisions that would require states
Semiannual Report to Congress | April 1, 2023–September 30, 2023 61
Worker and Retiree Benefit Programs
to disclose unemployment compensation community-based organizations to help workers
data to the OIG for oversight, including learn about UI benefits and related services.
audits. ETA has also required sharing of state These opportunities also support state agencies
UI data as a condition of fraud prevention in delivering timely and accurate benefits to
grants to provide such access through 2025 workers. The Department has launched the UI
and recently issued guidance supporting IT Modernization Project - Claimant Experience
additional grants that would provide Pilot, partnering with states for product
access for potentially the next 2 to 5 years. development, with outcomes published online.
According to ETA, 52 of 53 SWAs received Moreover, over $200 million in IT modernization
grants. The Inspector General is authorized grants have been awarded to 19 states,
to have timely access without constraints to aiming to foster the adoption of modular and
this data under the Inspector General Act of evidence-driven strategies.
1978, as amended, and needs access to all
UI program data. OIG Ongoing and Planned Work
On August 31, 2021, the Department The OIG’s efforts to strengthen and protect the
established the Office of Unemployment UI program continue. In addition to working with
Insurance Modernization to work with state our law enforcement partners to combat fraud
agencies and federal partners to modernize in the program, we will be issuing additional
and reform the UI system. According to the audit reports covering critical areas of concern
Department, the Office of Unemployment and opportunities for improvement in the UI
Insurance Modernization will provide oversight program. Planned and in-progress113 Phase 3
and management of the $1 billion112 allotted audit work includes:
to UI initiatives by the American Rescue Plan
• effectiveness of the Short-Time
Act of 2021 (ARPA) to prevent and detect
Compensation program;*
fraud, promote equitable access, ensure timely
benefits payments, and reduce backlogs. • effectiveness of the Mixed Earner
To achieve this, the Office of Unemployment Unemployment Compensation program;*
Insurance Modernization has allocated • adequacy of state staffing resources;*
targeted grants to states and territories, offered • ETA and state efforts to detect and recover
improved guidance, directed assistance, and overpayments;*
tested technology-driven solutions.
• PRAC Case Study Project on federal
pandemic response funds in select
The Department also noted it has announced
geographic areas;*
and provided grant opportunities to states,
including funds for pilot states to engage • ETA and states’ efforts to address:
112 The American Rescue Plan Act of 2021 initially allotted $2 billion to UI initiatives; however, $1 billion was
rescinded by the Fiscal Responsibility Act of 2023.
113 Audits in progress are marked with an asterisk (*).
62 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
◦ multistate claimants;* Rocha & Company, PC (Rocha), to conduct
◦ claimants using deceased persons’ Social an audit addressing our concerns about risks
Security numbers;* associated with the expansion of UI benefits and
the disbursement of federal funds to claimants
◦ claimants using prisoners’ Social Security
in need during the pandemic. Rocha found ETA
numbers;* and
and states did not always meet the requirements
◦ claimants with suspicious email or statutory intent of the TFFF program and that
accounts;* ETA needs a plan to reconcile and return to
• impact of waivers on UI overpayments, fraud Treasury nearly $5 billion unused by states.
investigations, and recoveries;*
Rocha assessed ETA’s oversight, performed
• joint review with U.S. Small Business
in-depth testing of 6 states, and surveyed an
Administration OIG;*
additional 47 SWAs. They found individual
• mandatory audit of DOL’s FY 2023 claimants waited to receive urgently needed UI
compliance with PIIA;114 benefits and states received TFFF funding when
• DOL and states’ oversight of UI claimants the states were not eligible. Also, states’ TFFF
return to work; accounts have unused fund balances that have
• ARPA Equity Grants; and not been reconciled, closed out for deobligation,
and returned to Treasury. These issues
• Office of UI Modernization’s efforts to
occurred because ETA did not have sufficient
improve SWAs’ UI IT systems.
controls in place to ensure states accessing
funds were in fact eligible for reimbursements
For more information about the OIG’s work, please
or that unused TFFF funds were returned to the
visit our online Pandemic Response Portal.115
federal government.
COVID-19: ETA Needs a Plan to Specifically, four states were allowed to access
Reconcile and Return to the U.S. TFFF funding as reimbursements despite not
Treasury Nearly $5 Billion Unused by meeting program requirements. For example,
States for a Temporary Unemployment two states with waiting weeks required by
Insurance Program their existing laws did not waive those weeks.
However, the states were reimbursed for UI
Under the CARES Act, $12.5 billion was made benefits paid after making claimants wait for
available to the 53 SWAs through the TFFF their first week of UI compensation—contrary
program. The program paid the cost of the first to the intent of the program. In addition, another
week of an eligible claimant’s UI benefits for two states used first week UI compensation
states with no waiting week. We contracted with amounts paid outside the scope of the program
an independent certified public accounting firm, period as the basis to be reimbursed.
114 A large portion of this annual audit focuses on UI.
115 Our Pandemic Response Portal is available at: https://www.oig.dol.gov/OIG_Pandemic_Response_Portal.htm.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 63
Worker and Retiree Benefit Programs
As a result, these states were reimbursed largest pandemic-related UI program. Based
$105.1 million of federal funding they were not on audits of previous emergency UI program
eligible to receive. Further, of the $12.5 billion in implementation, we were concerned with ETA’s
funding made available to the 53 SWAs through ability to effectively and efficiently deploy
the TFFF program, nearly $5 billion remained PUA funding, which totaled over $130 billion.
unused as of July 31, 2023—more than We contracted with the independent certified
22 months after the program ended— public accounting firm of Key & Associates,
with no formal plan to reconcile states’ accounts P.C. (Key & Associates) to conduct an audit to
and deobligate remaining funds for return determine if non-traditional claimants received
to Treasury. PUA benefits as intended under the CARES
Act and subsequent legislation.
We made eight recommendations to ETA to
improve oversight of TFFF and similar future Key & Associates found non-traditional claimants
emergency relief programs. We recommended received necessary PUA benefits as intended
ETA establish deadlines, write procedures, under the CARES Act and subsequent
and develop controls to ensure states meet legislation. However, the program was weakened
program requirements. We also recommended by billions in overpayments, including fraud.
ETA: (1) establish written procedures and Traditionally, UI claimants’ income would be
deadlines for the timely return of funding verified through employment records; however,
for TFFF and future similar programs and the CARES Act permitted non-traditional
(2) consult with OMB and Treasury officials to claimants to self-certify their eligibility for PUA.
execute the proper return of unused funds that Starting in April 2020, less than a month after
remain within states’ accounts. CARES Act passage, the OIG highlighted the
risk associated with permitting claimants to
For more information, go to https://www.oig. self-certify their eligibility. Subsequent to the
dol.gov/public/reports/oa/2023/19-23-015- OIG’s related work, Congress modified PUA to
03-315.pdf, Report No. 19-23-015-03-315 require documentation in late December 2020.
(September 28, 2023) However, 81 percent of all approved PUA claims
were filed prior to the end of 2020. Key &
COVID-19: Pandemic Unemployment Associates found that allowing claimants to
Assistance for Non-Traditional self-certify their eligibility—coupled with states’
difficulties with implementing new UI programs
Claimants Weakened by Billions in
and the substantial increase in claims volume—
Overpayments, including Fraud
led to significant overpayments, including fraud.
One of several new programs created under
From April 1, 2020, to March 31, 2023,
the CARES Act, PUA provided UI benefits to
the 53 SWAs reported nearly $35 billion
workers who were not traditionally eligible,
in established PUA overpayments. These
such as independent contractors, gigworkers,
overpayments included $20 billion in PUA
and sole proprietors (non-traditional
benefits and approximately $15 billion in
claimants). It quickly became the second
64 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
FPUC benefits, which was the supplement lack of comprehensive safeguards and the
that was attached to each UI claim paid. In substantial volume of claims, which meant that
total, states reported that over 15 percent of staff usually responsible for promoting and
all PUA benefits paid were overpayments. maintaining the integrity of the UI program had
Further, in collaboration with the OIG, to assist with processing claims. Additionally,
Key & Associates found that 10.8 percent of state officials reported that the level of identity
PUA claims exhibited potentially fraudulent theft affected state efforts to detect other types
activity, including instances of benefits paid of overpayments. Further, Social Security
to individuals with Social Security numbers Administration database verification did not
used to file UI claims in multiple states or of prevent this fraud because certain fraudsters
deceased persons. While these indicators— used stolen information to file claims.
previously reported by the OIG—do not
measure the full extent of PUA fraud, they The elevated levels of fraud that the PUA
indicate the vulnerability of the program. program experienced can likely be partially
explained by the fraud triangle. The fraud
According to state officials, states faced triangle suggests that, when all three
challenges in mitigating fraud within PUA components—opportunity, incentive, and
despite implementing various countermeasures, rationalization—are present, individuals are
such as identity verification service contractors more likely to engage in fraudulent activities.
and multi-factor authentication. They further A review of the PUA program indicates exposure
reported that the program’s vulnerability to to all three components (see Figure 5).
fraudulent activity persisted, mainly due to a
Figure 5: Fraud Triangle for the PUA Program
Source: Key & Associates analysis of the PUA program
Semiannual Report to Congress | April 1, 2023–September 30, 2023 65
Worker and Retiree Benefit Programs
Further, statements from ETA and SWAs, COVID-19: ETA Can Improve Its
along with the OIG’s Office of Investigations Oversight to Ensure Integrity over
case activity, suggest that fraud in the UI CARES Act UI Programs
program has continued after the expiration
of pandemic-related programs. The OIG’s In support of UI program integrity during the
Office of Investigations continues to see the pandemic, ETA encouraged states to use tools
same fraud typologies being committed by from NASWA. One of those tools was the
sophisticated cyber-enabled bad actors and IDH, a centralized platform that brings SWAs
criminal enterprises that it combatted during together to compare and analyze UI claim data
the pandemic. The threat level, while lower for enhanced detection and prevention of UI
than at the peak of the pandemic, remains fraud and other improper payments. Given the
significant. Therefore, the regular UI program risks associated with the amount of CARES
continues to be at risk, underscoring the urgent Act funding and previous issues with program
need for improved security measures and fraud expansions, we conducted an audit focused on
prevention strategies. ETA’s oversight of UI program integrity in three
key CARES Act programs.
The OIG’s Office of Investigations
continues to see the same fraud Overall, we found ETA needs to improve its
typologies being committed by oversight of NASWA’s IDH. During this reporting
sophisticated cyber-enabled bad actors period, we issued a memorandum to ETA on
and criminal enterprises that it combatted three specific matters for their attention. We
during the pandemic. anticipate that other ongoing and future work will
address the remaining areas of focus. The three
Key & Associates made three recommendations matters were: (1) ETA did not ensure an initial
to ETA to improve oversight of the UI program, assessment of NASWA’s IDH was performed in
including by documenting lessons learned for compliance with federal requirements, (2) ETA
use in providing legislative technical assistance did not provide documentation it had evaluated
and operational guidance to Congress and NASWA’s security assessment reports, and
the states on any future emergency programs. (3) the IDH was less effective at identifying
The recommendations also included issuing potentially improper multistate claims when
guidance to states about and working with compared to the OIG’s data. For the third
congressional stakeholders regarding the matter, NASWA’s IDH identified 39.7 percent of
urgency of the expiring statute of limitations for the potentially improper multistate claims when
crimes related to pandemic UI fraud. compared to those we identified for the same
states using NASWA’s multistate methodology.
For more information, go to https://www.oig.
dol.gov/public/reports/oa/2023/19-23-014- Based on our analysis, the limited effectiveness
03-315.pdf, Report No. 19-23-014-03-315 of NASWA’s IDH in identifying potentially
(September 27, 2023). improper payments, including fraud, is further
compounded by the fact that the IDH lacks
66 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
consistent, regular participation of enrolled Alert Memorandum: ETA Needs
states. ETA maintained it did not have the to Incorporate Data Analytics
authority to require states to participate in the Capability to Improve Oversight of the
IDH, nor did ETA have an alternate means of
Unemployment Insurance Program
meeting the same program integrity objectives
when a state opted out of participation. As such,
The rapid expansion and substantial increase
state UI programs dependent on NASWA’s
in UI benefits during the COVID-19 pandemic
IDH as a tool for reducing improper payments
significantly increased the risk for fraud,
are vulnerable to under-detecting potentially
waste, and abuse in UI programs. The OIG
improper payments, including fraud.
has identified nearly $1.3 billion in potentially
fraudulent UI payments made during the
We made three recommendations to ETA to
pandemic in two high-risk age categories,
improve oversight and functionality of the IDH:
to individuals with Social Security numbers:
implementing a process to ensure required and
(1) of children under the age of 14 and (2) of
timely reviews of IDH, completing an evaluation
elderly persons 100 years of age or older.
on IDH effectiveness, and working with NASWA
We previously identified more than $45.6 billion
to determine the best threshold for flagging
in potentially fraudulent UI pandemic benefits
multistate claims.
paid in 4 other high-risk areas.116 Our latest
analysis brings the cumulative total amount
For more information, go to https://www.oig.
of potentially fraudulent payments to more
dol.gov/public/reports/oa/2023/19-23-011-03-
than $46.9 billion in the 6 high-risk areas
315.pdf, Report No. 19-23-011-03-315
(see Figure 6).
(September 22, 2023).
Figure 6: Six High-Risk Areas for Potential UI Fraud Identified by the OIG
Source: OIG data analysis of state UI claims data
116 Alert Memorandum: Potentially Fraudulent Unemployment Insurance Payments in High-Risk Areas Increased to
$45.6 Billion, Report No. 19-22-005-03-315, (September 21, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 67
Worker and Retiree Benefit Programs
We are concerned that ETA currently does not We made three recommendations to ETA to:
have direct access to state UI claims data. ETA obtain direct access to UI claims from all states,
also does not have the capability to analyze create an integrity program with a data analytics
said data, which would allow it to better identify capability, and establish effective controls to
fraud and other improper payments, as well mitigate fraud and other improper payments to
as other trends or emerging issues, such as ineligible claimants in high-risk age categories.
timeliness or equity.
For more information, go to https://www.oig.
To assist states in their efforts to improve dol.gov/public/reports/oa/2023/19-23-012-
integrity in the UI program, DOL encourages 03-315.pdf, Report No. 19-23-012-03-315
states to use tools available from the UI (September 25, 2023).
Integrity Center,117 including the IDH. However,
states are not required to participate in the COVID-19: Unemployment Relief for
IDH and those that do participate do so to Governmental Entities and Nonprofit
varying degrees—which has limited the IDH’s Organizations Should Have Been
effectiveness. However, even if these limitations
Better Managed
were resolved, it would not relieve ETA from its
program oversight responsibilities.
Under the CARES Act and subsequent
legislation, $6.3 billion was funded to the
Ready access to UI claims data from all states
53 SWAs through the EURGENO program
and territories would enable ETA to ensure
(Figure 7). The program was created to
proper administration and provide sufficient
mitigate the economic effects of the COVID-19
oversight of the UI program. The results of our
pandemic for governmental entities and nonprofit
analysis in this and previous alert memoranda
organizations that reimburse states for eligible UI
show how effective and beneficial data analytics
benefits paid (reimbursing employers) between
can be in providing program oversight and
March 13, 2020, and September 6, 2021.
identifying trends to assist in combatting fraud.
Based on OIG audits of previous emergency
UI program implementation and funding, we
Ultimately, a data access and analytics
contracted with Rocha to conduct an audit
capability would allow ETA management to
addressing our concerns with ETA’s ability to
make better informed decisions about the UI
effectively and efficiently deploy UI funding under
program and help mitigate the risk of improper
the EURGENO program. We found ETA and
payments, including fraud. Such a capability
states did not effectively execute EURGENO or
would also prepare ETA for future emergency UI
ensure full compliance with related provisions
programs where hundreds of billions in federal
of the CARES Act and subsequent legislation.
dollars could be at risk.
Consequently, reimbursing employers faced
117 The UI Integrity Center is a joint federal-state initiative funded by DOL and operated by NASWA. NASWA is the
national organization representing all of the state workforce agencies and whose mission is to enhance the state
workforce agencies’ abilities to accomplish their goals, statutory roles, and responsibilities.
68 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
Figure 7: EURGENO Funding and Refund/Credit Process
Source: Rocha graphical representation of EURGENO, including state, ETA, and Treasury procedures as well as flow
of funding
Semiannual Report to Congress | April 1, 2023–September 30, 2023 69
Worker and Retiree Benefit Programs
delays in receiving pandemic relief and states As a result, states received millions in
received millions in federal funding that should be funding that needs to be returned to the
returned to the federal government. federal government. ETA needs to perform a
reconciliation to determine the exact amount
Rocha assessed ETA’s oversight, performed of ineligible funds; however, Rocha identified
in-depth testing for 6 states118 (the States of: approximately $29 million in questioned costs in
Hawaii, Illinois, Mississippi, Oklahoma, Vermont, the 6 states alone.
and West Virginia) and surveyed 47 other SWAs.
Guidance from OMB advised states to prioritize To improve oversight of the UI program, we
expediency; however, Rocha found the 6 states recommended that ETA obtain evidence from
did not consistently provide refunds or credits to the states that ensures all EURGENO refunds
reimbursing employers in less than 30 days, and credits to which reimbursing employers
with 1 state taking over a year. Also, three of are entitled have been provided. We also
six states issued bills to reimbursing employers recommended that ETA work with states to
that did not reflect EURGENO credits, resulting reconcile remaining balances that factor in both
in reimbursing employers overpaying states. actual EURGENO relief and excess EURGENO
These issues were attributed to state challenges relief provided due to the impact of other UI
in implementing new UI programs, legacy IT or CARES Act provisions or fraud. Lastly,
systems, insufficient monitoring by ETA, and we recommended ETA determine the proper
untimely notifications to eligible employers about disposition of excess funds and take necessary
available EURGENO pandemic relief funds. actions, including recovery of questioned costs.
To improve oversight of the UI program, For more information, go to https://www.oig.
we recommended that ETA obtain dol.gov/public/reports/oa/2023/19-23-010-
evidence from the states that ensures all 03-315.pdf, Report No. 19-23-010-03-315
EURGENO refunds and credits to which (September 21, 2023).
reimbursing employers are entitled have
been provided. COVID-19: Audit of State Workforce
Agencies’ Information Technology
Further, Rocha found the six states received Systems Capability in Processing
funding associated with ineligible benefit weeks,
Unemployment Insurance Claims
including weeks covered by another CARES Act
provision. This resulted from ETA not providing
State preparedness, specifically the issues
sufficient guidance or monitoring reviews to
of staffing and system capabilities, is a core
ensure compliance with program requirements.
concern for the OIG. Based on our concern,
Additionally, the states were provided funds
we contracted with GenTech Associates
based on claims later identified as fraudulent.
(GenTech) to conduct a performance audit
118 The six states were selected based on an OIG risk analysis.
70 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
to determine to what extent the capability of ETA relies on several stakeholders to assist
SWAs’ UI IT systems impacted their ability to SWAs with UI IT system modernization
timely and accurately process UI claims from initiatives and has partnered with NASWA’s
March 27, 2020, through April 6, 2021, including UI Information Technology Service Center
pandemic-related claims. GenTech identified no for this purpose. Personnel from NASWA’s UI
material findings that the OIG had not previously Information Technology Service Center stated
reported to ETA. Additionally, DOL has begun to GenTech that the service center provides
significant efforts in the UI IT modernization119 recommendations to SWAs but has no authority
area. However, GenTech did identify one issue to enforce the recommendations.
for ETA management’s attention: specifically,
ETA could improve its oversight of SWA In providing this memorandum to ETA,
progress in modernizing UI IT systems. the OIG considered this audit closed. No
recommendations were issued, and no official
GenTech identified that, historically, ETA did management response was required of ETA.
not evaluate the capability of SWAs’ UI IT The memorandum, however, does not preclude
systems to successfully administer UI benefits. the OIG from conducting a follow-up audit of
Further, ETA did not have sufficient information this subject at a later date. We plan to perform
to know which SWAs’ UI IT systems posed the follow-on work in the area of UI IT modernization
greatest risk of failing. This lack of sufficient to determine the impact of DOL’s efforts on
information happened because ETA did not improving the efficient deployment of UI benefits,
require SWAs to develop UI IT modernization including readiness for future emergencies.
plans with the following three elements to
represent a future-ready approach: baseline For more information, go to https://www.oig.
architecture,120 target architecture,121 and a dol.gov/public/reports/oa/2023/19-23-008-
transition plan to reach the target architecture. 03-315.pdf, Report No. 19-23-008-03-135
For example, only 1 of 10 SWAs reviewed had (September 19, 2023).
developed or implemented UI IT modernization
plans that improved the timeliness or accuracy ETA Did Not Provide Adequate
of UI benefits processing. The surveyed SWAs Oversight of Emergency
reported similar results: only 14 of 38 reported Administrative Grants
implementation of an IT modernization plan
with a future-ready approach. On March 18, 2020, Congress provided
$1 billion in emergency administrative grants
119 IT modernization refers to an organization’s efforts to upgrade legacy IT systems and to ensure that existing IT
systems do not become legacy systems. Legacy IT systems are those that are past their lifecycle end date for either
technical or business reasons.
120 Baseline architecture refers to an organization’s existing IT systems and infrastructure.
121 Target architecture refers to an organization’s description of future IT systems and infrastructure that would
replace the organization’s baseline architecture.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 71
Worker and Retiree Benefit Programs
through Division D of the Families First administrative grants to administer UI programs.
Coronavirus Response Act, the Emergency These funds were monitored through single
Unemployment Insurance Stabilization and audits that did not disclose how states used the
Access Act of 2020 (EUISAA). The act provided funds. For example, in a review of the single audit
states with temporary flexibility to modify reports for five states, we found only one of the
their unemployment compensation laws and five states had a single audit report disclosing
additional administrative funding to respond the amount of emergency administrative grant
to the economic downturn caused by the funds spent and that report did not disclose
COVID-19 pandemic. We conducted an audit how states spent the funds. Single audit
to determine if DOL, through ETA, provided reports for the remaining four states made no
adequate oversight of emergency administrative mention of the emergency administrative grants,
grants authorized under EUISAA. We found despite the states withdrawing their emergency
ETA did not provide adequate oversight of the administrative grant funds.
emergency administrative grants.
The circumstances surrounding the provisions
Specifically, ETA did not verify if states were of emergency administrative grants created a
qualified for the grants before transferring all high risk of misuse. Consequently, $1 billion in
grant funds to the states’ accounts. According to taxpayer dollars were vulnerable to misuse. We
ETA, verification did not occur because the states made three recommendations to ETA to improve
urgently needed to address the increase in UI the future administration of emergency grants.
claims caused by the pandemic. Consequently,
ETA relied on states’ self-attestations of For more information, go to https://www.oig.
compliance with EUISAA requirements to qualify dol.gov/public/reports/oa/2023/19-23-006-
them for the grants. ETA did not require states to 03-315.pdf, Report No. 19-23-006-03-315
submit documentation supporting compliance with (July 27, 2023).
the requirements until after the states received
their total share of the $1 billion in emergency Tracking the Department of Labor’s
administrative grant funds. As a result, for the Unemployment Insurance Response
14 states we reviewed, we identified more than to Local Communities During
$136 million as questioned costs.
the Pandemic
We also found ETA could not provide reasonable
The PRAC122 led a two-phased review to identify
assurance states used the emergency
the federal pandemic funds distributed to local
122 The PRAC was created by the CARES Act to support and coordinate independent oversight of more than $5
trillion in pandemic relief programs and spending. For more information, visit: https://www.PandemicOversight.gov/.
72 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
communities123 across the United States as of workers impacted by the pandemic, including
September 30, 2021, and to determine if the workers not usually eligible for benefits: PUA,
spending of the funds aligned with program PEUC, FPUC, and TFFF. One community
goals. In support of this review, the OIG also received funding from the Mixed Earner
conducted an evaluation of DOL’s UI response Unemployment Compensation program.
to the COVID-19 pandemic. We specifically
evaluated DOL programs that expanded UI Under an agreement with DOL, SWAs made
benefits for workers who were impacted by the the pandemic-related UI payments to claimants
pandemic. Our evaluation included any benefits and DOL made funding available to cover the
that claimants received from these programs, cost of the payments, ongoing administrative
as reported by the states. These programs were needs, and reasonable implementation costs.
selected based on federal spending research For the period of March 27, 2020, through
and program funding amounts. September 6, 2021, the OIG identified more
than 33,400 UI beneficiaries across the
All six communities implemented at least four 6 communities; collectively, they received over
pandemic UI programs that sought to assist $516 million (see Table 3).124
Table 3: Total Pandemic-Related UI Benefits in the Six Communities,
March 27, 2020, through September 6, 2021
Average Benefit
Program Total Benefits Paid Total Claimants
Per Claimant
FPUC $323,248,650 33,329 $9,699
PUA $118,434,214 7,893 $15,005
PEUC $74,352,092 10,192 $7,295
MEUC* $13,900 4 $3,475
Total $516,048,856 33,433125 $15,435
*Mixed Earner Unemployment Compensation
Source: OIG Data Analysis of SWA Claims Data
123 The PRAC selected six locations for review across three types of geographic areas (two small-to-medium
sized cities, two rural counties, and two Tribal areas). The following six locations were selected: Springfield,
Massachusetts; Coeur d’Alene, Idaho; Marion County, Georgia; Sheridan County, Nebraska; White Earth
Reservation in Minnesota; and Jicarilla Apache Reservation in New Mexico.
124 The data provided by the states was insufficient to calculate the amount of TFFF benefits paid to individuals.
125 Individual claimants could receive benefits from multiple pandemic-related UI programs.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 73
Worker and Retiree Benefit Programs
This work applies to our efforts performed including family members and close friends, in a
during the first phase of the PRAC review, conspiracy that specifically targeted UI benefits
which focused on identifying the UI program expanded to offset the economic impacts of the
funding provided to local communities to help COVID-19 pandemic. To obtain these benefits,
them respond to the pandemic. For additional she and others filed false and misleading UI
information on federal pandemic funds provided applications in the names of identity theft
to the six communities from DOL and nine other victims, co-conspirators, and inmates of state
participating federal agencies, see the PRAC’s and federal prisons.
report, “Tracking Pandemic Relief Funds that
Went to Local Communities Reveals Persistent To further their conspiracy, Huffman and
Data Gaps and Data Reliability Issues,” issued others identified addresses in each of the
on July 6, 2023.126 targeted states in which they falsely claimed
the applicants lived and worked. She also
For more information, go to https://www.oig. opened a post office box in the Commonwealth
dol.gov/public/reports/oa/2023/19-23-007- of Virginia in the name of a fictitious nonprofit
03-315.pdf, Report No. 19-23-007-03-315 organization, to which she directed the targeted
(July 10, 2023). SWAs to mail the prepaid debit cards. Huffman,
who was then employed as a registered nurse
Former Federal Employee Sentenced at a U.S. Department of Veterans Affairs
to 18 Years in Prison for Leading Medical Center in Richmond, Virginia, used
her work computer to research available UI
$3.5 Million Pandemic Unemployment
benefits, file and access fraudulent UI claims,
Insurance Fraud Scheme
and falsify documents.
On August 23, 2023, Heather Ann Huffman,
In total, Huffman and her conspirators submitted
a former registered nurse employed with the
more than 220 fraudulent UI claims in the
U.S. Department of Veterans Affairs, was
names of more than 120 individuals to at least
sentenced in the Commonwealth of Virginia to
five different SWAs through which they sought
18 years in prison for her role in a conspiracy
to receive more than $3.5 million and actually
to defraud at least five SWAs of more than
obtained more than $2 million.
$3.5 million in pandemic-related UI benefits.
She was also ordered to pay more than
Huffman’s sentencing was originally scheduled
$2 million in restitution to multiple SWAs jointly
for November 2022, but she failed to appear
with her co-conspirators.
that day without notice or explanation. Prior to
her disappearance, she took measures to flee
From April 2020 through at least March 2021,
prosecution, conceal her whereabouts, and
Huffman led and organized several others,
126 PRAC, Tracking Pandemic Relief Funds that Went to Local Communities Reveals Persistent Data Gaps and
Data Reliability Issues, Report No. PRAC-2023-04 (July 6, 2023), available at:
https://www.pandemicoversight.gov/media/file/practracking-pandemic-relief-fundsimpact-phase-i0pdf
74 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
obtain the PII of another individual. Huffman for UI benefits with the State of California’s
assumed the individual’s identity and procured Employment Development Department. Demola
counterfeit government identification and also obtained the PII of identity theft victims and
credit cards in the name of her false alias. filed fraudulent UI applications in their names.
An extensive joint investigation with the U.S. Once the fraudulent applications were approved
Department of Veterans Affairs OIG and the by the Employment Development Department,
United States Marshals Service uncovered members of the conspiracy received
evidence that the defendant was living and Employment Development Department-funded
working under a false identity as a registered debit cards that allowed them to withdraw
nurse in the State of Kansas. Representatives money from ATMs across Southern California.
from the United States Marshals Service
Fugitive Task Force arrested Huffman on This is a joint investigation with the El Camino
March 4, 2023, in Lenexa, Kansas. Real Financial Crimes Task Force, a multi-agency
task force led by Homeland Security
This is a joint investigation with U.S. Department Investigations that includes federal and state
of Veterans Affairs OIG. United States v. investigators who are focused on financial
Huffman et al. (E.D. Virginia) crimes in Southern California. United States v.
Natalie Le Demola et al. (C.D. California)
Convicted Murderer Who Ran
$1.5 Million COVID-19 Jobless Benefits Two Members of Robles Park127
Fraud from Behind Bars Sentenced to Criminal Enterprise Sentenced for
7 Years in Federal Prison Roles in Racketeering Conspiracy
that included Pandemic-Related
On July 10, 2023, Natalie Le Demola, who is Unemployment Insurance Fraud
currently serving a life sentence in state prison
for murder, was sentenced to 84 months in On June 6, 2023, Keaujay Hornsby, also
federal prison, to be served consecutively, known as “Plug,” was sentenced to 201 months
and ordered to pay more than $933,000 in in prison in connection with his May 2022
restitution for leading a pandemic-related guilty plea to numerous charges, including
benefits scheme from behind bars, involving racketeering conspiracy in furtherance of a
more than $1.5 million in UI benefits. criminal enterprise known as Robles Park,
assault with a dangerous weapon in aid of
From June 2020 until April 2021, Demola racketeering, and aggravated identity theft. On
and her co-conspirators acquired the PII of the same date, Kareem Spann, also known as
individuals ineligible for UI benefits as they were “Reem,” was sentenced to 130 months in prison
either employed, retired, or incarcerated. They in connection with his February 2023 guilty plea
used the PII to file fraudulent online applications
127 Robles Park is a criminal organization whose members and associates engaged in acts involving murder, assault,
intimidation, narcotics trafficking, access device fraud, identity theft, obstruction of justice, and other crimes.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 75
Worker and Retiree Benefit Programs
to numerous charges, including racketeering Additionally, in March 2020, following the
conspiracy in furtherance of Robles Park, pandemic-related expansion of UI benefits,
assault with a dangerous weapon in aid of Johnson and co-conspirators used the PII of
racketeering, and conspiracy to commit fraud. victims without their knowledge to apply for and
receive UI benefits. The benefits were loaded
In addition to committing violent and drug crimes, onto prepaid debit cards delivered to addresses
Hornsby and Spann obtained the PII of others to which Johnson and others had access.
to submit fraudulent applications for UI benefits. Johnson and his co-conspirators then obtained
More than $420,000 in UI benefits were paid to the debit cards and withdrew the fraudulently
Robles Park members in the form of debit cards obtained funds and used the funds to purchase
issued in the names of identity theft victims who United States Postal Service money orders.
did not provide their PII, or permission to use Johnson and his co-conspirators are linked to
their PII, to Robles Park members. at least $1.9 million in attempted fraudulent UI
claims submitted to 19 different SWAs.
This was a joint investigation with the Federal
Bureau of Investigation (FBI) and the Tampa The benefits were loaded onto prepaid
Police Department. United States v. Keaujay debit cards delivered to addresses to
Hornsby (M.D. Florida), United States v. Kareem which Johnson and others had access.
Spann (M.D. Florida) Johnson and his co-conspirators then
obtained the debit cards and withdrew the
International Firearms Dealer Involved fraudulently obtained funds and used the
in $1.9 Million COVID-19 Fraud funds to purchase United States Postal
Service money orders.
Scheme Sentenced to More Than
7 Years in Prison
This was a joint investigation with the U.S.
Postal Inspection Service; U.S. Department of
On April 19, 2023, Daniel Ira Johnson, also
Commerce Bureau of Industry and Security;
known as “Shotta” also known as “Lajon Black,”
Homeland Security Investigations; the Bureau of
was sentenced to 90 months in prison for
Alcohol, Tobacco, Firearms, and Explosives; and
shipping firearms to the United Kingdom and
the National Crime Agency of the United Kingdom.
committing wire fraud and aggravated identity
United States v. Johnson (M.D. Florida)
theft in connection with receiving fraudulently
obtained COVID-19 pandemic UI relief
payments. Johnson was also ordered to pay Virginia Man Sentenced to 7 Years in
restitution totaling more than $580,000. Prison for Role in Pandemic-Related
Unemployment Insurance Fraud, Mail
In December 2019 and January 2020, Johnson Theft, and Bank Fraud Schemes
shipped firearms to a co-conspirator in Rugby,
England, concealing them in a safe, wrapping On June 14, 2023, Eric Wilhoit II was sentenced to
them to avoid detection, and declaring them 84 months in prison for conspiring to fraudulently
to be “car parts” on customs paperwork. obtain pandemic UI benefits and for his role
76 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
in a mail theft and bank fraud scheme. Wilhoit Maryland Men Sentenced to Over
was also ordered to pay more than $1.7 million 9 Years in Prison for Conspiracy to
in restitution to the Virginia Employment Obtain More than $1 Million in COVID-19
Commission (the SWA for the Commonwealth of
Unemployment Insurance Benefits and
Virginia) jointly with his co-conspirators.
Other Pandemic Relief Loans
From May 2020 through January 2022, Wilhoit
On June 26, 2023, Jerry Phillips was sentenced
conspired with family members and others to
to 84 months in prison for his role in a federal
fraudulently obtain more than $1.7 million in
wire fraud conspiracy, aggravated identity theft,
pandemic-related UI benefits by applying in the
and illegal possession of a machine gun related
names of identity theft victims and others who
to a scheme to fraudulently obtain more than
were ineligible to receive UI benefits. Wilhoit
$1 million in pandemic-related benefits, including
instructed his co-conspirators on how to make
UI benefits and loans related to the PPP and
the fraudulent UI claims. The group then used
EIDL program. Phillips was also ordered to
virtual private networks and false or anonymized
pay restitution totaling more than $1.2 million.
email addresses in an attempt to hide the fraud.
Additionally, his brother, Jaleel Phillips, who
Each member of the conspiracy recruited others
previously pled guilty to his role in the wire fraud
to use their physical addresses to receive prepaid
debit cards that contained UI benefits. Wilhoit
and his co-conspirators then made significant
cash withdrawals from the prepaid debit cards
and purchased luxury goods and at least one
firearm with the UI benefits. Specifically, Wilhoit
and one co-conspirator purchased a diamond
ring, a Chanel purse, Christian Louboutin shoes,
and many other items.
Additionally, Wilhoit was involved in a separate
mail and bank fraud scheme led by two
co-conspirators. One co-conspirator stole
checks from United States Postal Service
collection boxes and provided the checks or
personal information from the checks to the
other co-conspirator, who then used the
information to create counterfeit checks or in
furtherance of other fraudulent activity. Wilhoit
recruited individuals to provide their bank
During the execution of a UI fraud search warrant, OIG
accounts for depositing the fraudulent checks. agents recovered a ballistic vest, UI debit cards, and
deadly weapons, including three ghost guns, which are
This is a joint investigation with the FBI. United privately made, non serialized firearms purchased in
States v. Wilhoit et al. (E.D. Virginia) individual parts and then assembled that are untraceable.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 77
Worker and Retiree Benefit Programs
conspiracy, was sentenced on June 22, 2023, parts and then assembled that is untraceable.
to 30 months in federal prison and ordered to Phillips illegally modified one of the ghost guns
pay restitution. into a machine gun capable of firing multiple
rounds with one pull of the trigger.
From March 2020 to February 2022, the
Phillips brothers conspired with at least one other This is a joint investigation with the Internal
person to fraudulently obtain COVID-19-related Revenue Service–Criminal Investigation, Federal
benefits through falsified PPP loan applications, Deposit Insurance Corporation OIG, and the
EIDL applications, and UI claims. Phillips and his U.S. Small Business Administration OIG. United
coconspirators created aliases, used the PII of States v. Jerry Phillips (D. Maryland)
identity theft victims, and used defunct corporate
entities or new business entities with no actual Georgia Man Sentenced for Laundering
business operations to fraudulently apply for Proceeds Derived from the Submission
UI benefits and various PPP and EIDL loans. of Fraudulent Unemployment Claims in
Among other purchases, Jerry Phillips used more
Multiple States
than $65,000 of the fraudulently obtained funds
to purchase a 2020 Chevrolet Camaro.
On June 14, 2023, Oluwagbemiga Otufale
was sentenced to 84 months in prison after
pleading guilty for his role in a money laundering
conspiracy. Otufale was also ordered to pay
almost $500,000 in restitution to various SWAs.
Otufale laundered money obtained from the
submission of fraudulent UI claims filed in
multiple states by other individuals using the
stolen PII of more than 50 identity theft victims.
He also laundered proceeds from a business
email compromise scheme targeting two
Various cards and fraudulent identity documents
seized from a safe during the execution of a
businesses in the State of Georgia.
residential search warrant. The cards and IDs
were in the names of false identities created for Otufale created multiple aliases and sham
the purpose of filing for COVID-19 benefits. business entities to open financial accounts
into which he deposited fraudulent proceeds
A search of Phillips’ residence recovered more
and from which he withdrew cash. In total, he
than 25 fake driver’s licenses from multiple
laundered approximately $2.6 million in fraud
states and multiple identification documents
proceeds through at least 6 bank accounts.
from different jurisdictions with the same alias.
Law enforcement also recovered four “ghost
This was a joint investigation with the FBI,
guns,” which Jerry Phillips purchased online
U.S. Postal Inspection Service, and Homeland
using an alias. A ghost gun is a privately made,
Security Investigations. United States v.
non-serialized firearm purchased in individual
Oluwagbemiga Otufale (N.D. Georgia)
78 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
California Man Sentenced to Prison for parcel of land in the State of Vermont; at least
$1.6 Million Unemployment Scam eight alpacas; almost $110,000 seized from
a bank account; and a classic 1950 Hudson
On August 18, 2023, Idowu Hashim Shittu, was automobile. McIntrye was sentenced pursuant to
sentenced to 30 months in prison for fraudulently his April 2023 guilty plea to four counts of wire
obtaining more than $1.6 million in pandemic-related fraud and three counts of money laundering.
UI benefits from numerous SWAs.
McIntyre is the former owner of Rasta Pasta
In July 2020, law enforcement officers executed Pizzeria in Beverly, Massachusetts. In March
a search warrant at Shittu’s residence and 2020, he used the names of his adult children
discovered more than $500,000 in cash. to submit two fraudulent applications to the
Officers also found more than 400 reloadable U.S. Small Business Administration for EIDLs
bank cards issued in the names of others, which for businesses that did not exist. Beginning in
were loaded with more than $1.6 million in UI April 2020, McIntyre submitted an application
benefits from various SWAs. and weekly certifications in order to receive
PUA benefits. In these filings, McIntyre
The investigation revealed that Shittu obtained falsely claimed that he was not working or
these reloadable debit cards between at least receiving income because of the pandemic
April through July 2020 and used them for his while McIntyre was, in fact, still operating the
personal use. Shittu did not know the victims restaurant and paying himself income from the
to whom the UI benefits were issued, nor did business. By September 2020, when McIntyre
he obtain their consent before using the cards. sold the restaurant, he had received more than
Shittu made cash withdrawals and paid for $17,000 in PUA and related benefits to which
service on his luxury automobile. he was not entitled.
This was a joint investigation with the FBI. In April 2020, McIntyre submitted a fraudulent
United States v. Idowu Hashim Shittu application for a PPP loan of more than
(N.D. California) $660,000 through an U.S. Small Business
Administration-approved lender. After
Former Massachusetts Pizzeria Owner receiving a PPP loan of more than $660,000,
he sold the restaurant and used nearly all
Sentenced to 2 Years in Prison for
the funds to purchase a farm in the State of
COVID-19 Fraud Vermont, alpacas, vehicles, and airtime for his
cryptocurrency-themed radio show.
On August 30, 2023, Dana McIntyre was
sentenced to 24 months in prison and ordered
This was a joint investigation with the FBI, the
to pay more than $675,000 in restitution to the
Internal Revenue Service–Criminal Investigation,
Commonwealth of Massachusetts’ Department
and the U.S. Department of Housing and Urban
of Unemployment Assistance and an approved
Development OIG. United States v. Dana L.
PPP lender. He was also ordered to forfeit: a
McIntyre (D. Massachusetts)
Semiannual Report to Congress | April 1, 2023–September 30, 2023 79
Worker and Retiree Benefit Programs
Office of Workers’ Compensation Programs
The Office of Workers’ Compensation Programs (OWCP) administers four major workers’ compensation
programs: Federal Employees’ Compensation Act (FECA), Energy Employees Occupational Illness
Compensation (Energy), Black Lung Benefits, and Longshore and Harbor Workers’ Compensation.
FECA is the largest of the programs and provides workers’ compensation coverage to millions of federal,
postal, and other employees for work-related injuries and illnesses. Benefits include wage replacement,
payment for medical care, vocational rehabilitation, and survivor benefits.
Nine Defendants Sentenced to • Dr. James Don Jackson: 60 months in prison
More than 760 Months Combined and more than $1.6 million;
Imprisonment in a $126 Million • Nirvana Hightower: 60 months in prison and
Pharmaceutical Compounding approximately $19.9 million;
Fraud Scheme • Keith Hudson: 36 months in prison and
approximately $13.7 million;
In April 2023, nine defendants—including three • Audra Jones: 30 months in prison and
compounding pharmacy128 owners, a physician, approximately $18.9 million;
two pharmacists, and three patient recruiters—
• Sherod Johnson: 18 months in prison and
were sentenced for their roles in a years-long,
approximately $939,000; and
multistate scheme to defraud OWCP and
TRICARE129 of nearly $126 million. The nine • Terrance Aice: 18 months and approximately
defendants were sentenced and ordered to pay $939,000.
joint and several restitution130 as follows:
Cruise and his co-conspirators submitted false
• John Cruise: 240 months in prison and
and fraudulent claims to OWCP and TRICARE
approximately $32 million;
for prescriptions for compounded and other
• Lashonia Johnson: 180 months in prison and drugs prescribed for injured federal workers and
more than $32 million; members of the armed forces. The defendants
• Kenny Ozoude: 120 months in prison and also paid kickbacks to patient recruiters and
approximately $19.9 million; physicians to prescribe these drugs.
128 Generally, compounding is a practice in which a licensed pharmacist or physician combines ingredients of a
drug to create a medication tailored to the needs of an individual patient.
129 TRICARE is the health care program for uniformed service members, retirees, and their families around the
world.
130 Joint and several restitution is when two or more parties are jointly and severally liable for a criminal act, each
party is independently liable for the full extent of the injuries stemming from the criminal act.
80 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker and Retiree Benefit Programs
In furtherance of the scheme, the defendants From November 2012 through June 2019, he
chose the particular compounds and other paid physicians’ remuneration or kickbacks to
medications not based on the patients’ medical refer their patients’ compounding prescriptions
needs, but rather based on the reimbursement to OK Compounding, LLC and One Stop
amount. The drugs were then mailed to patients RX, LLC. Parks was aware that some of
even though they were often never requested, the compounding prescriptions were paid
wanted, or needed by the patients. by federal health care programs, including
the FECA program. Specifically, the FECA
This is a joint investigation with the United program was billed more than $1.18 million
States Postal Service OIG, U.S. Department of in claims involving compounded medication
Defense OIG, and the United States Department creams, of which more than $550,000 was
of Veterans Affairs OIG. United States v. John paid out. In furtherance of the scheme, Parks
Cruise et al. (S.D. Texas) paid the prescribing physicians through bank
accounts he controlled and attempted to
Oklahoma Man Pled Guilty to Paying disguise the kickback payments by entering
Health Care Kickbacks into agreements with physicians for purported
medical studies.
On June 27, 2023, Christopher R. Parks pled
guilty to one count of conspiracy to offer and This is a joint investigation with the FBI,
pay health care kickbacks in a scheme involving U.S. Department of Defense OIG, Internal
the referral of compounding prescriptions Revenue Service–Criminal Investigation, United
to compounding pharmacies in the State of States Postal Service OIG, United States
Oklahoma where he was an owner and operator. Department of Veterans Affairs OIG, and United
States Department of Health and Human
Parks was a joint owner and operator of OK Services OIG. United States v. Christopher R.
Compounding, LLC, and One Stop RX, LLC. Parks (N.D. Oklahoma)
Semiannual Report to Congress | April 1, 2023–September 30, 2023 81
Worker Safety, Health,
and Workplace Rights
Worker Safety, Health, and Workplace Rights
Occupational Safety and Health Administration
The mission of the Occupational Safety and Health Administration (OSHA) is to ensure safe and healthful
working conditions for workers by setting and enforcing workplace safety and health standards and by
providing training, outreach, education, and assistance.
COVID-19: OSHA Needs to Do More even faster. Consistently high rates of injury
to Address High Injury Rates of and illness before and during the COVID-19
pandemic indicated that warehouses were and
Warehouse Workers
continued to be dangerous places to work. In
2021, the injury and illness rate was 5.5 per 100
OSHA’s mission is to ensure safe and healthful
employees, about double the 2.7 rate across all
working conditions for workers nationwide.
industries. Based on these risks, we conducted
This includes about 1.6 million workers at the
a performance audit to determine the extent
nation’s nearly 20,000 warehouses. Warehouse
to which OSHA has addressed high injury and
workers face hazards that can result in serious
illness rates at warehouses (before and during
injury due to powered industrial trucks, loaded
the COVID-19 pandemic).
pallets, and the repetitive movements involved.
These dangers can be compounded when
We found OSHA’s actions had not effectively
time-based delivery quotas are used to drive
addressed the high injury and illness rates
production goals. With high-speed fulfillment
occurring in warehouses. Despite consistently
of online orders becoming the industry
high injury and illness rates, OSHA conducted a
standard, some warehouse workers must work
84 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker Safety, Health, and Workplace Rights
limited number of warehouse inspections: 3,762.
Also, 82 percent of these inspections were
unprogrammed, primarily driven by complaints
and referrals. In addition, OSHA did not target
nor inspect enough warehouses through its
Site-Specific Targeting programs, designed
to reach establishments with high injury and
illness rates. OSHA had limited controls in
place to ensure an adequate number of Site-
Specific Targeting inspections occurred and
did not timely monitor program activity to
determine how many proposed inspections
actually occurred until after the programs
ended. The number of establishments targeted
versus establishments inspected indicated the
programs resulted in very few inspections of Overall, OSHA collected minimal injury data
the targeted establishments, meaning workers from employers and did not effectively enforce
remain vulnerable to high rates of injury mandatory employer reporting, leaving workers
and illness. at risk to hazards that can result in serious
injury and illness.
Further, OSHA had limited visibility into the
numbers and types of injuries and illnesses To identify and address injuries and illnesses
occurring in warehouses, including those at warehouses, OSHA utilizes a variety of data
that classified themselves as online retailers. sources. These sources all have individual
Regarding online retailers, OSHA was limitations, such as preventing OSHA from
unable to determine how many of these knowing at which establishments workers
establishments were warehouses. Online are exposed to workplace hazards. However,
retailers are not required to submit injury and collectively, these data show the extent and
illness data unless the establishment had 250 persistence of certain hazards, such as
or more employees at any time during the prior overexertion and musculoskeletal disorders,131
year. However, the reporting non-compliance which OSHA has not sufficiently addressed.
rate in this industry for those that were required Between 2016 and 2020, BLS reported a
to report was 46 percent, limiting OSHA’s total of 99,860 injuries and illnesses involving
view of injuries and potentially impacting the one or more day(s) away from work in the
effectiveness of OSHA’s enforcement program. warehousing and storage industry, of which
131 OSHA defined overexertion/bodily reaction as injuries resulting from motions such as lifting, bending, reaching,
or slipping without falling. A musculoskeletal disorder is a disease that affects the muscles, nerves, blood vessels,
ligaments, and tendons, incurred by lifting heavy items, bending, reaching overhead, pushing and pulling heavy
loads, working in awkward body postures, and repetitive tasks.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 85
Worker Safety, Health, and Workplace Rights
Figure 8: BLS-reported Warehouse Injuries by Events, 2016-2020
Source: BLS Occupational Injuries and Illnesses and Fatal Injuries Profiles
Note, for an accessible version of this figure, please see the report’s Exhibit 2, Figure 2.
47 percent were attributed to overexertion/ program; and an improved enforcement strategy
bodily reaction (see Figure 8). for employer reporting compliance and data use.
These compelling data demand focused For more information, go to https://www.oig.
attention and more enforcement activity to better dol.gov/public/reports/oa/2023/19-23-013-
protect workers at warehouses nationwide. 10-105.pdf, Report No. 19-23-013-10-105
(September 27, 2023).
As a result of these issues, warehouse workers
were at increased risk. The consistently high COVID-19: OSHA Needs to Strengthen
injury and illness rates before and during the Its Process for Awarding Future
COVID-19 pandemic indicated that warehouse
Emergency Supplemental Funds to
workers were facing and continued to face
State Plans
hazards that can result in serious injuries and
illnesses. We made seven recommendations
ARPA provided OSHA with no less than
to OSHA to improve its efforts to ensure
$100 million in additional funding, of which
warehouse workers’ safety and health, including
no less than $5 million was allotted for
for updated criteria, and specific, measurable
enforcement activities related to COVID-19
inspection goals for the Site-Specific Targeting
at high-risk workplaces including health
86 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Worker Safety, Health, and Workplace Rights
care, meat and poultry processing facilities, State Plans received grant funding, which was
agricultural workplaces, and correctional ultimately $12.4 million out of the $16 million
facilities. A prior audit identified concerns with initially apportioned for State Plan grants.135
the decreased level of COVID-19 inspections,
leaving U.S. workers’ safety at increased In addition, of the $12.4 million awarded, OSHA
risk. Therefore, we contracted with GenTech awarded $7.5 million to a grant recipient with
Associates, Inc. to conduct a performance audit known financial and reporting issues without
to determine if OSHA appropriately budgeted establishing mitigating controls to help ensure
and expended ARPA funds to carry out the appropriate use and reporting of funds.
COVID-19-related worker protection activities. OSHA did not follow proper grant application
procedures to determine if the state’s financial
Based on a review of 7 of the 10 ARPA program system could track, account for, and report on
areas,132 GenTech found that, in general, OSHA expenditures before awarding ARPA funds.
appropriately expended ARPA funds. However, The inability of a grant recipient’s financial-
OSHA did not effectively manage the awarding management system to provide past expense
process to maximize coverage across State reconciliations or submit prompt and accurate
Plans133 and had insufficient controls in place to reports may have hindered OSHA’s timely
expend funds designated for State Plan grants. detection and prevention of misused funds.
GenTech found OSHA neglected to adequately GenTech made two recommendations to OSHA
coordinate with the Departmental Budget to: 1) develop a plan for future crises that
Center134 regarding the time needed to afford affords State Plans the maximum opportunity
State Plans the maximum opportunity to meet to receive federal assistance and 2) update
the grant matching requirement. Some of the its monitoring procedures to better respond to
states that declined the supplemental funding grant recipient noncompliance.
expressed concerns about the limited time they
were given to respond to the initial notification— For more information, go to https://www.oig.
particularly because they needed to respond dol.gov/public/reports/oa/2023/19-23-009-
with the amount of funding they could match 10-105.pdf, Report No. 19-23-009-10-105
and obligate. As a result, only 5 of the 28 (August 30, 2023).
132 The seven ARPA program areas were: Standards, Enforcement, Whistleblower Protection, State Plan Grants,
Technical Support, Compliance Assistance – Federal, and Susan Harwood Training Grants.
133 The term “State Plans” refers to those states with an OSHA-approved workplace safety and health program.
State Plans are monitored by OSHA and must be at least as effective as OSHA in protecting workers and in
preventing work-related injuries, illnesses, and deaths.
134 The Departmental Budget Center provides DOL with direction, policy advice, technical assistance, and related
services concerning budget formulation, justification, and execution.
135 OSHA appropriated $16 million for State Plan grants for FY 2021. This amount was later reduced to
$12.4 million.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 87
Employment and
Training Programs
Employment and Training Administration Programs
Employment and Training
Administration Programs
The Employment and Training Administration administers federal government job training and worker
dislocation programs. This includes programs authorized by the Workforce Innovation and Opportunity Act
(WIOA) that provide employment assistance, labor market information, and job training for adults, youth,
dislocated workers, and other targeted populations. The WIOA aims to strengthen the public workforce
system and help get Americans—including youth and those with significant barriers to employment—
into high-quality jobs and careers. The WIOA also helps employers hire and retain skilled workers.
COVID-19: The Employment and intended purposes during the COVID-19
Training Administration Needs to pandemic. Our work, which is part of a series of
audits being conducted across selected states,
Improve Oversight of Grants Awarded
focused on grant recipients and sub-recipients
in New Jersey
located in the State of New Jersey.
From October 2018 through September 2021,
Our work, which is part of a series of
ETA awarded 2,093 grants, totaling approximately
audits being conducted across selected
$16 billion to grant recipients in all 50 states, the
states, focused on grant recipients and
District of Columbia, and U.S. territories. ETA
sub-recipients located in the State of
awards grants136 to states, local governments,
New Jersey.
and other entities to provide opportunities to
individuals with significant barriers to employment
Based on a review of four grants totaling more
to enter into high-quality jobs and careers, as
than $248 million—including three statutory
well as to help employers hire and retain skilled
WIOA grants and one discretionary non-WIOA
workers. During the timeframe of these grants,
grant—we found that ETA grant recipients and
the pandemic created many challenges for ETA
sub-recipients received grant funds to provide
job training programs across the nation, such as
career, training, and supportive services
stay-at-home orders, which impacted ETA’s ability
(e.g., transportation or childcare). However,
to provide services. We conducted a performance
ETA did not ensure recipients in the State of
audit to determine if ETA grant recipients and
New Jersey effectively used these funds.
sub-recipients137 utilized grant funds for the
136 The grants are either: (1) statutory grants, which are noncompetitive grants required by law to be given to the
state or outlying area based on statistical criteria or (2) discretionary grants awarded based on competitive selection
and eligibility.
137 Recipients of ETA’s grant awards, such as states, can allocate some or all these funds to other entities known
as sub-recipients. A sub-recipient is a non-federal entity that receives a sub-award from a passthrough entity to
carry out part of a federal program. It does not include an individual who is a beneficiary of the program.
90 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Employment and Training Administration Programs
Specifically, ETA did not ensure recipients update guidance to better identify and account
effectively: (1) used over $100 million to serve for risks associated with grant fund use; and
the intended population; (2) enrolled eligible improve assistance to and monitoring of grant
individuals in the grant programs, costing recipients to ensure they can account for and
$96,580 in training services; and (3) complied report on federal awards, as well as understand
with federal requirements when paying how to properly award contracts.
$168,460 in services. For example, one grant
recipient could not demonstrate 314 of the Figure 9: Enrollment Status of Grant
1,441 participants we reviewed were eligible for Sub-Recipient Program Participants
a grant program awarded to develop, expand,
and scale apprenticeships nationally in H-1B
health care industry occupations. Of these
1,441 participants, 252 were attributed to one
of the sampled sub-recipients and identified as
being enrolled. We found the grant recipient
overstated the number of participants enrolled
in the program by 238 individuals—only 14
individuals could be identified as being officially
enrolled, with the rest only having completed
inquiry forms (see Figure 9).138
In addition, two sub-recipients of a WIOA state
formula grant did not have a system in place
to account for the $6.9 million in grant funding
received, including how it was spent. As a result,
there is a risk the $6.9 million awarded to the
sub-recipients may not have been spent
according to its intended purposes. We, therefore,
questioned the entire amount awarded to these
two sub-recipients. For the grants reviewed, Source: OIG analysis of sample data
we identified more than $100 million in funds
that could have been put to better use and For more information, go to https://www.oig.
approximately $7.2 million in questioned costs. dol.gov/public/reports/oa/2023/19-23-016-
03-391.pdf, Report No. 19-23-016-03-391
We made seven recommendations to ETA to: (September 28, 2023).
resolve questioned costs and unspent funds;
138 Inquiry form information included having conversations with potential students about the programs and the
apprenticeship model. The grant recipient agreed that completing an inquiry form and/or application alone does not
deem the student a “participant served.”
Semiannual Report to Congress | April 1, 2023–September 30, 2023 91
Employment and Training Administration Programs
Florida Woman Convicted of funds to her personal account and the personal
Conspiracy to Commit Theft of and corporate accounts of coconspirators.
Government Funds To steal the funds, a co-conspirator created
fraudulent employee files and wage records
On July 7, 2023, Sirce Rodriguez pled guilty for showing that individuals were employed at
her involvement in a conspiracy to commit theft specific companies when they were not.
of government funds by diverting federal funds Rodriguez provided the PII of others in order
for her personal benefit and the benefit of her to create the employee files. Rodriguez also
co-conspirators. The funds were diverted from referred others to a co-conspirator to receive
Transition, Inc., a not-for-profit organization that wages for work they did not perform. The
received WIOA funds, which are administered information of these individuals was inputted into
by DOL, and Improved Reentry Project a web-based program run by Transition, Inc.’s
Grant funds, which are administered by the payroll processor, which then paid wages to
U.S. Department of Education. The WIOA funds the purported employees, with the money often
were supposed to be used for job training and being deposited into bank accounts controlled
placement services. by Rodriguez and her co-conspirator.
Rodriguez conspired with a former employee This is a joint investigation with the Miami-Dade
of Transition, Inc., and others, to divert WIOA County OIG. United States v. Salado Garcia et
al. (S.D. Florida)
92 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Employment and Training Administration Programs
Foreign Labor Certification Programs
ETA administers a number of foreign labor certification (FLC) programs that allow U.S. employers to employ
foreign workers to meet domestic worker shortages: PERM, CW-1, H-1B, H-2A, and H-2B. The PERM
program allows an employer to hire foreign nationals to work in the United States on a permanent basis
while the CW-1, H-1B, H-2A, and H-2B programs are for temporary employment in the United States. The
CW-1 program allows employers to hire workers on a temporary basis in the Commonwealth of the Northern
Mariana Islands. The H-1B program allows employers to hire foreign workers on a temporary basis in
specialty occupations or as fashion models. The H-2A program allows employers to hire foreign workers for
temporary agricultural jobs, in contrast to the H-2B program, which is for temporary non-agricultural jobs.
ETA ensures that the admission of foreign workers into the United States on a PERM, CW-1, H-2A, or H-2B
visa will not adversely affect job opportunities, wages, and working conditions of U.S. workers. The OIG also
investigates labor trafficking cases that involve fraud against FLC programs.
Two Owners and a Manager of in Williamsburg, Virginia. Magnolia Cleaning
Virginia Commercial Laundry Services, where Landaverde served as a
manager, cleaned and delivered linens to
Business Sentenced to Prison for
various hospitality establishments.
Roles in Labor Trafficking and Money
Laundering Conspiracy Landaverde, Vaughan, and Evans participated
in a conspiracy to defraud and commit offenses
In August 2023, three defendants, who against the United States, including human
owned and/or managed a commercial laundry trafficking of individuals from Central America,
business in Virginia, were sentenced for their benefiting from forced labor, money laundering,
respective roles in a labor trafficking and and harboring undocumented workers. Under
money laundering conspiracy. their direction, Magnolia Cleaning Services
exploited the victims to work long hours in poor
Ana Patricia Aragon Landaverde was sentenced working conditions. In some cases, workers were
to 57 months in prison and forfeiture of more than threatened with deportation, physical harm, and
$213,000, jointly with co-defendants; Jeffrey Dean harm to their families if they refused to work as
Vaughan was sentenced to 51 months in prison directed. Some undocumented workers lived in
and forfeiture of more than $3.9 million, jointly with the laundry facility without access to a kitchen or
codefendants; and George Williams Evans was bathroom with a shower or bathtub. One victim
sentenced to 30 months in prison and forfeiture of was a child who was made to work night shifts
more than $3.9 million, jointly with co-defendants. while attending school during the day.
Restitution to the victims remains pending.
Between the first quarter of 2018 and the first
Vaughan and Evans were the owners of quarter of 2022, the business’s wage records
Magnolia Cleaning Services, which is located reflected approximately 121 employees with
Semiannual Report to Congress | April 1, 2023–September 30, 2023 93
Employment and Training Administration Programs
alleged invalid or mismatched Social Security v. Santos Teodoro Ac-Salazar and Olga Choc
numbers and wage payments of more than Laj (N.D. Illinois)
$1.2 million to these employees.
Wisconsin Man Sentenced for False
This is a joint investigation with Homeland Statements involving Foreign Workers
Security Investigations, U.S. Postal Inspection
Service, and U.S. Social Security Administration On April 17, 2023, Alfredo Aguilar Sr. was
OIG. United States v. Ana Patricia Aragon sentenced to 18 months in prison and ordered
Landaverde et al. (E.D. Virginia) to pay restitution of more than $1.1 million to
foreign workers. He was also ordered to pay
Guatemalan Man Sentenced for the a civil monetary penalty of approximately
Forced Labor of Two Minors $210,000 to DOL. Aguilar previously pled guilty
to making false statements to federal agencies.
On April 25, 2023, Santos Ac-Salazar was
sentenced to 78 months in prison and ordered From 2015 to December 2018, Aguilar was
to pay more than $98,000 in restitution for his co-owner of a State of Wisconsin-based
role in trafficking two minor Guatemalan victims. business, Northwoods Forestry, Inc.
He recruited workers from Mexico and
From February 2019 through February 2020, Central America, specifically H-2B workers,
Ac-Salazar and his co-defendant Olga Choc Laj to work in the forestry industry, planting and
conspired to unlawfully enter the United States caring for trees and clearing and developing
with two children who were not their own, to more woodlands. Northwoods Forestry, Inc. agents
easily enter the country and avoid prolonged made representations under oath to DOL and
detention by U.S. immigration authorities. U.S. Citizenship and Immigration Services
regarding the type of work the workers
Ac-Salazar and Choc Laj obtained fraudulent would perform and the wages they would
identity documents for one of the minors, falsely receive. However, Aguilar actually placed the
representing that she was an adult and legally H-2B workers with non-forestry employers,
permitted to be in the United States. They refused including in meat packing, construction,
to allow her to leave their control and made her roofing, agriculture, painting, fur processing,
work in various jobs and as a domestic servant and landscaping businesses. Northwoods
to pay debts owed for being smuggled and rent. Forestry, Inc. failed to pay the H-2B workers the
They also forced the second minor to work as a appropriate wages and overtime and deducted
domestic servant. Ac-Salazar and Choc Laj did expenses from the employees’ pay, all contrary
not pay the minors for their domestic work and to sworn statements made to DOL.
physically assaulted and threatened the children if
they did not comply with their demands. This is a joint investigation with the Wage and
Hour Division and U.S. Department of State–
This is a joint investigation with the FBI and Diplomatic Security Services. United States v.
Homeland Security Investigations. United States Alfredo Aguilar (W.D. Wisconsin)
94 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Labor Racketeering
Labor Racketeering
Labor Racketeering
Under the Inspector General Act of 1978, as amended, the OIG is responsible for investigating labor
racketeering and the influence of organized criminal enterprises involving unions, employee benefit plans,
and labor-management relations.
Labor racketeering refers to the infiltration, exploitation, or control of a union, employee benefit plan,
employer entity, or workforce, carried out through illegal, violent, or fraudulent means. OIG labor racketeering
investigations focus largely on individuals and organized criminal enterprises engaged in embezzlement,
extortion, violence against union members or employers, and other related criminal activities.
Our investigations continue to identify fraudulent payments from employers to union representatives in
order to gain favorable labor agreements for the employer. Our investigations have also identified complex
financial and investment schemes used to defraud union-affiliated benefit plans, resulting in millions of
dollars in losses to plan participants.
Massachusetts Man Pled Guilty to remittance reports with the benefit funds and
Multi-Million-Dollar Payroll Scheme the unions to under-report the overtime hours
worked by these employees, thereby depriving
On September 6, 2023, Frank Loconte pled the benefit funds and unions of contributions and
guilty to one count of mail fraud and one count dues owed on behalf of their members.
of failing to pay taxes in connection with a
payroll scheme involving the underreporting of Loconte defrauded union workers of more than
overtime hours for his union employees and $1 million in benefits and dues related to overtime
failing to collect and pay payroll taxes. work covered by collective bargaining agreements
and defrauded the Internal Revenue Service of
Loconte was president of NER Construction more than $3 million by not making the required
Management Corporation, a construction payroll tax withholdings and payments. Instead
company that employed union workers and of paying employment taxes, Loconte used NER
collectively bargained with multiple unions. Construction Management Corporation business
From approximately 2014 through May 2022, accounts to pay for personal expenses, including
he engaged in a scheme to defraud union- vehicles, personal property taxes, household
affiliated benefit funds and the Internal Revenue improvements, and golf memberships.
Service. Loconte accomplished this by paying
certain union workers for overtime hours without This is a joint investigation with EBSA, the
reporting these hours to the union-affiliated Office of Labor-Management Standards,
benefit funds and without making the required the Internal Revenue Service-Criminal
payroll tax withholdings and payments. He also Investigation, and the FBI. United States v.
caused the corporation to file false and fraudulent Frank Loconte (D. Massachusetts)
96 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Departmental
Management
Departmental Management
Departmental Management
The OIG performs oversight work involving the Department’s operations, financial management, and
IT services.
Service Auditors’ Report on the all material respects that the description fairly
Integrated Federal Employees’ presented the claims processing system and
that the related controls were suitably designed
Compensation System for the
and operating with sufficient effectiveness to
Period October 1, 2022, through
provide reasonable, but not absolute, assurance
June 30, 2023 that the control objectives were achieved for the
audit period.
The OIG contracted with the independent
certified public accounting firm KPMG LLP This report, No. 22-23-008-04-431
(KPMG) to perform an examination of the (September 20, 2023), contains sensitive
Integrated Federal Employees’ Compensation information and will not be released publicly.
System (iFECS) transaction processing
for application and general controls and to
DOL’s Purchase and Travel Card
determine if iFECS application and general
controls, as described in the report, were fairly Risks Assessed as Low and
presented, suitably designed, and effectively Moderate, Respectively
operating for the period October 1, 2022,
through June 30, 2023. The Government Charge Card Abuse
Prevention Act of 2012 (Charge Card Act)
The controls and control objectives included in was designed to prevent recurring waste,
the description are those that the management fraud, and abuse of government-wide charge
of OWCP’s Division of Federal Employees’ cards. We contracted with KPMG to assist
Longshore and Harbor Workers’ Compensation with the risk assessment of DOL’s purchase
and the Office of the Assistant Secretary and travel card programs for the period
for Administration and Management believe October 1, 2021, through September 30, 2022,
are likely to be internal controls for financial pursuant to the Charge Card Act. To perform
reporting relevant to user entities of the FECA the risk assessment, key program objectives
Special Fund and iFECS throughout the period. were assessed for the purchase and travel
KPMG examined the suitability of the design card programs. Various methods of review
and operating effectiveness of the controls and analytical testing were used to assess the
and control objectives. KPMG concluded in residual risks139 as of September 30, 2022,
139 Residual risk is the exposure remaining from an inherent risk after action has been taken to manage it, using
the same assessment standards as the inherent assessment.
98 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Departmental Management
assign a risk impact and risk likelihood level,140 For the travel card program, two objectives had
and then assign a risk level ranging from a moderate risk level, one had a low risk level,
very low to very high. For the purchase card and three had a very low risk level
program, four objectives had a low risk level (see Figure 10).
and two had a very low risk level.
Figure 10: Definitions of Risk Impacts and Likelihoods
Risk Level Risk Impact Definition Risk Likelihood Definition
The degradation of an activity or role is
Risk event is almost
severe, impacting the ability to meet one or
certain to occur.
Very High more strategic goals or objectives, produce
Likelihood of occurrence
key deliverables, or reach required levels of
is 90-100 percent.
performance to meet the mission.
The degradation of an activity or role is major,
Risk event is highly likely
requiring immediate escalation or management
High to occur. Likelihood of
intervention to reach required levels of
occurrence is 50-90 percent.
performance of key functions.
The degradation of an activity or role is Risk event is possible
Moderate moderate with material impact on performance to occur. Likelihood of
of key functions. occurrence is 25-50 percent.
The degradation of an activity or role is minor. Risk event is unlikely
Low It is noticeable and may affect performance of to occur. Likelihood of
key functions. occurrence is 10-25 percent.
The degradation in activity or role is negligible Risk event occurrence
Very Low and is not expected to significantly affect is remote. Likelihood of
performance of key functions. occurrence is 0-10 percent.
Source: DOL OIG Framework for Enterprise Risk Management, Version 3.0, May 31, 2022
140 Risk impact is the likely magnitude that the risks would have on the key objective. Risk likelihood is the level of
possibility that a risk will occur that affects the key objective.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 99
Departmental Management
Based on the results of the assessment, the compliance with PIIA, as defined in Title 31
overall risk of illegal, improper, or erroneous of the United States Code (U.S.C.) § 3351(2),
use of DOL’s purchase and travel cards is for the fiscal year ended September 30, 2022.
low and moderate, respectively. The detailed PIIA requires federal agencies to identify
assessments of DOL’s purchase and travel card programs susceptible to significant improper
programs were provided to DOL officials. payments, estimate the improper payments for
those programs, and report on actions to reduce
For more information, go to https://www.oig. the improper payments in those programs.
dol.gov/public/reports/oa/2023/22-23-007-
50-598.pdf, Report No. 22-23-007-50-598 As noted in our prior year report,141 DOL
(August 30, 2023). continued to report the State Unemployment
Insurance program, which includes the
The U.S. Department of Labor PEUC program and the FPUC payment
Did Not Meet the Requirements activity collectively as one program—the UI
program—based on OMB’s approval.
for Compliance with the Payment
Integrity Information Act for FY 2022
KPMG’s objective to evaluate DOL’s
compliance with PIIA included determining
The OIG contracted with KPMG to conduct whether DOL met six PIIA compliance
a performance audit related to DOL’s requirements in relation to the UI, PUA, and
141 The U.S. Department of Labor Did Not Meet the Requirements for Compliance with the Payment Integrity
Information Act for FY 2021, Report No. 22-22-007-13-001 (July 1, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2022/22-22-007-13-001.pdf
100 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Departmental Management
Table 4: Criteria for PIIA Requirements Not Met for the UI Program and PUA
Programs Requirement # Criteria
Published improper payment estimates for all programs and
PUA 3 activities identified under § 3352(a) in the accompanying
materials to the annual financial statement (if required)
Published programmatic corrective action plans prepared
PUA 4 under § 3352(d) that DOL may have in the accompanying
materials to the annual financial statement
Published improper payments reduction targets established
under § 3352(d) that DOL may have in the accompanying
UI & PUA 5 materials to the financial statement for each program or activity
assessed to be at risk, and has demonstrated improvements
and developed a plan to meet the reduction targets
Reported an improper payment rate of less than 10 percent for
UI & PUA 6 each program and activity for which an estimate was published
under § 3352(c)
FECA programs. KPMG concluded DOL met payment target rate published in FY 2021
four of the six requirements for compliance with as the combined total improper payment
PIIA for the UI program, two of the six rate increased. Compared to 18.92 percent
requirements for the PUA program, and all six reported in FY 2021, in FY 2022, DOL reported
requirements for the FECA program. See Table 4 a 21.52 percent improper payment rate and
for the requirements not met for UI and PUA. an unknown142 payment rate of 0.68 percent
equaling a combined total rate of 22.20 percent
KPMG determined Requirements 5 and 6 were for the UI program. Based on those rates, more
not met for the UI program. For Requirement than $18.9 billion of the $85.2 billion in total
5, KPMG noted the UI program did not UI program payments for the year were either
demonstrate improvement from the improper
142 An unknown payment is defined as a payment that could be either proper or improper, but the agency is unable
to discern whether the payment was proper or improper as a result of insufficient or lack of documentation.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 101
Departmental Management
Figure 11: DOL’s Reported UI Payments and Accuracy Rates, FY 2022
Source: DOL FY 2022 information reported on PaymentAccuracy.gov
unknown or improper (see Figure 11). The KPMG made three recommendations to DOL
UI program also did not meet Requirement 6 management to: 1) revise the methodology used
as the improper payment rate was above the to calculate the improper payment information
10 percent threshold. for the FPUC program, 2) maintain the current
focus on increasing technical assistance and
In addition to not meeting Requirements 5 and 6, funding to states to demonstrate improvement
the PUA program also did not meet Requirement on the rate, and 3) continue to work with OMB
3 to publish improper payment and unknown to develop an approved estimation methodology
payment estimates for programs susceptible for the PUA program and publish the resulting
to significant improper payments and unknown improper payment information.
payments and did not meet Requirement 4 to
publish corrective action plans. Although DOL We note that DOL management’s response
determined PUA to be susceptible to improper disagreed with the inclusion of the PUA program
payments in FY 2021, DOL did not include PUA in the analysis of improper payments, as well
improper payment information in its FY 2022 as the conclusion noted for Requirement 5 of
reporting. In October 2022, OMB stated the initial PIIA. As highlighted in KPMG’s report, the OMB
methodology DOL submitted in June 2022 for guidance and data call instructions support the
estimating the PUA program’s improper payment conclusions reached.
rate and amount required further analysis. OMB
requested DOL continue working to develop a For more information, go to https://www.oig.
sufficient methodology. The PUA program had dol.gov/public/reports/oa/2023/22-23-006-
outlays of $18.9 billion for the 2022 program year, 13-001.pdf, Report No. 22-23-006-13-001
and $137.7 billion since its inception in FY 2020. (June 9, 2023).
102 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Departmental Management
Single Audits
A single audit provides an organization-wide examination of an entity expending federal assistance funds
received for its operations. The audit is typically conducted annually by an independent certified public
accountant, and its objective is to provide assurance to the U.S. government regarding the management
and use of funds by recipients such as states, schools, universities, and nonprofits.
Quality Control Review of Quality Control Review for the Single
Single Audits Audit of South Carolina Department
of Employment and Workforce for the
Under OMB Uniform Guidance,143 cognizant Year Ended June 30, 2021
federal agencies ensure the implementation of
single audit requirements. A non-federal entity We performed a QCR of the independent
expending more than $50 million a year in federal certified public accounting firm Scott and
awards has a cognizant agency for audit.144 DOL Company, LLC’s (Firm) single audit of the
is currently cognizant for 12 entities. South Carolina Department of Employment and
Workforce for the Year Ended June 30, 2021.
The OIG periodically performs QCRs of Our QCR covered the UI program, which
single audits of entities over which DOL has equaled $3.67 billion of the $3.72 billion in
cognizance. During this reporting period, we total DOL funds. We determined the Firm’s
conducted three QCRs: (1) Single Audit of the audit report and audit work on the single audit
South Carolina Department of Employment and did not meet the requirements of government
Workforce for the Year Ended June 30, 2021; auditing standards, generally accepted auditing
(2) Single Audit of the Center for Workforce standards, and OMB Uniform Guidance.
Inclusion, Inc. for the Fiscal Year Ended June
30, 2022; and (3) Single Audit of the Puerto Our QCR covered the UI program, which
Rico Department of Economic Development equaled $3.67 billion of the $3.72 billion in
and Commerce for the Fiscal Year Ended total DOL funds. We found deficiencies in
June 30, 2021. the Firm's audit report and audit work.
143 Uniform Guidance refers to 2 C.F.R. Part 200, OMB’s “Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards.”
144 According to Uniform Guidance, the designated cognizant agency for audit must be the federal awarding agency
that provides the predominant amount of funding directly to a non-federal entity unless OMB designates a specific
cognizant agency for audit. Cognizant agencies for audit are the federal agencies designated to carry out the
responsibilities described in Uniform Guidance § 200.513(a).
Semiannual Report to Congress | April 1, 2023–September 30, 2023 103
Departmental Management
Specifically, we found deficiencies in the Firm’s Uniform Guidance. Our report did not contain
planning and testing of UI. We also noted that any recommendations.
the lack of internal controls in the PUA program
needed to be reported. Lastly, the Firm’s For more information, go to https://www.oig.
Schedule of Expenditures of Federal Awards dol.gov/public/reports/oa/2023/24-23-005-
was improperly presented. We made seven 50-598.pdf, Report No. 24-23-005-50-598
recommendations to the Firm to address the (September 27, 2023).
identified deficiencies, including revising and
reissuing the single audit report. Quality Control Review for the Single
Audit of the Puerto Rico Department
For more information, go to https://www.oig. of Economic Development and
dol.gov/public/reports/oa/2023/24-23-003-
Commerce for the Fiscal Year Ended
50-598.pdf, Report No. 24-23-003-50-598
(September 26, 2023). June 30, 2021
We performed a QCR of the independent
Quality Control Review for the Single
certified public accounting firm Galindez, LLC’s
Audit of the Center for Workforce single audit of the Puerto Rico Department
Inclusion, Inc. for the Fiscal Year of Economic Development and Commerce
Ended June 30, 2022 for the Fiscal Year Ended June 30, 2021. Our
QCR covered the WIOA Cluster, which totaled
We performed a QCR of the independent $82.4 million of DOL funds. We determined
certified public accounting firm Gorfine, Schiller Galindez, LLC’s audit work on the single audit
& Gardyn’s single audit of the Center for was acceptable and met the requirements
Workforce Inclusion, Inc. for the Fiscal Year of government auditing standards, generally
Ended June 30, 2022. Our QCR covered accepted auditing standards, and OMB
the Senior Community Service Employment Uniform Guidance. Our report did not contain
Program, which totaled $47.8 million of DOL any recommendations.
funds. We determined Gorfine, Schiller &
Gardyn’s audit work on the single audit was For more information, go to https://www.oig.
acceptable and met the requirements of dol.gov/public/reports/oa/2023/24-23-004-
government auditing standards, generally 50-598.pdf, Report No. 24-23-004-50-598
accepted auditing standards, and OMB (September 19, 2023).
104 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Employee Integrity
Investigations
Employee Integrity Investigations
Employee Integrity Investigations
The OIG is responsible for investigating possible misconduct or criminal activities involving senior DOL
employees or individuals providing services to the Department.
• The OIG conducted a criminal investigation • The OIG conducted an investigation as
into various fraud allegations involving to whether a senior employee allegedly
a DOL special agent. As a result of used a foreign email address on official
the investigation, the agent pled guilty correspondence and passed sensitive
to: fraudulently collecting $60,284 in contractual information to a DOL
unemployment insurance benefits while contractor. There was no evidence to
employed on full-time active duty with the support the allegations and no further
National Guard; defrauding the U.S. Army action was warranted.
of $24,582 in basic housing allowance; and • The OIG conducted an investigation as
fraudulently collecting $50,000 in lost wages to whether a senior employee violated
from an insurance company during the time the Anti-Lobbying Act during a meeting
they were suspended from DOL. The agent with a private organization. There was no
was sentenced to 33 months in federal evidence to support the allegations and
prison for their fraud schemes and ordered DOL provided the employee retraining in
to pay restitution in the amount of $197,366. ethics rules.
• The OIG conducted an investigation of a • The OIG conducted an investigation as
senior employee regarding the alleged use of to whether a DOL contract employee
a government-issued travel card for personal had solicited the U.S. Secretary of Labor
financial gain. The OIG found evidence with two separate bank checks in return
supporting the allegation and the employee for a partnership with their firm. Criminal
was terminated. charges were declined as the individual was
• The OIG conducted an investigation to terminated by the DOL contractor.
determine if an OIG employee failed to • The OIG conducted an investigation as to
properly secure their agency-approved whether a former DOL attorney violated
firearm while off-duty. As a result of the post-employment rules by working on a
investigation, the OIG substantiated the matter in their private practice that they
allegation. The employee was demoted and previously worked on while employed at the
reassigned to a non-supervisory position. Department. Criminal charges were declined.
The employee’s authority to carry an The former employee was notified of
agency-approved firearm off-duty was also post-employment restrictions and
permanently revoked. immediately ceased work on the matter.
106 Semiannual Report to Congress | April 1, 2023–September 30, 2023
OIG Whistleblower
Activities
OIG Whistleblower Activities
OIG Whistleblower Activities
Whistleblower Protection Coordinator 3. provides general information about the
timeliness of such cases, the availability
DOL employees, contractors, subcontractors, of any alternative dispute mechanisms,
and grantees perform an important service by and avenues for potential relief. Within the
reporting evidence of wrongdoing, including OIG, a Supervisory Associate Counsel
misconduct, fraud, waste, and abuse, in DOL to the Inspector General has been
programs. Whistleblowers should never be designated to serve as the Whistleblower
subjected to, or threatened with, retaliation for Protection Coordinator. Pursuant to this
having engaged in a protected communication designation, the Whistleblower Protection
or protected activity. The OIG plays a vital role in Coordinator has:
ensuring that DOL employees and employees of • provided input into training that is required
DOL grantees and contractors are informed of to be completed by all DOL employees,
their rights and protections against retaliation for entitled “Prohibited Personnel Practices,
“blowing the whistle.” This work is done by the OIG Whistleblower Protection”;
Whistleblower Protection Coordinator Program,
• provided input into training that is required
housed in the OIG’s Office of Legal Services.
to be completed by all DOL supervisors
and managers entitled “Responding to
Pursuant to Section 2 of the Whistleblower
Whistleblower Retaliation Complaints/
Protection Coordination Act of 2018 (S.1869,
Overview of Prohibited Personnel
June 25, 2018), every Inspector General’s
Practices – Annual Training”;
office is required to designate a Whistleblower
Protection Coordinator. According to Section 2, • developed training for new employees
the Whistleblower Protection Coordinator: titled “Whistleblower Rights and
Protections for DOL Employees” that
1. educates agency employees about prohibitions is included in all DOL employees’ New
against retaliation for protected disclosures; Employee Orientation and regularly
provides this training live to Solicitor’s
2. educates agency employees who have Office’s Honors Attorneys;
made or are contemplating making a • updated the DOL OIG public-facing
protected disclosure about their rights and website titled “Whistleblower Protection
the remedies against retaliation for protected Coordinator,” which is available to
disclosures, including the means by which all DOL and OIG employees, to
employees may seek review of any allegation provide information on whistleblower
of reprisal, as well as about the roles of the protections and options for DOL
OIG, the Office of Special Counsel, the Merit employees and employees of DOL
Systems Protection Board, and any other contractors and grantees;
relevant entities; and
108 Semiannual Report to Congress | April 1, 2023–September 30, 2023
OIG Whistleblower Activities
• provided live training to all OIG • participated on the panel of
employees on “Whistleblower Rights and Whistleblower Protection Coordinators
Protections for OIG Employees;” for the Council of the Inspectors
• established a dedicated e-mail address— General on Integrity and Efficiency
OIGWhistleblower@oig.dol.gov— Whistleblower Education Forum.
to receive and respond to whistleblower-
related inquiries from DOL employees Whistleblower Retaliation
and employees of DOL contractors Investigations
and grantees;
• obtained the OIG’s recertification of The OIG can initiate its own investigations
its 2302(c) program from the Office of into allegations of improper or illegal
Special Counsel (July 2023); retaliation brought by DOL employees or, on
a discretionary basis, refer such allegations
• monitored whistleblower retaliation
to the Office of Special Counsel for review
complaints received by the OIG, as well
and investigation.
as whistleblower retaliation investigations
conducted by the OIG;
Further, pursuant to 41 U.S.C. § 4712, the
• conducted training for the State OIG is required, with some exceptions,
Workforce Agencies State Monitor to investigate whistleblower retaliation
Advocates on Whistleblower Protections allegations made by employees of DOL
for Employees of DOL Grantees and contractors or grantees.
Contractors; and
Table 5: Whistleblower Investigations, April 1, 2023–September 30, 2023
Investigation Type Number
Pending DOL employee complaint investigations 4
Reports related to DOL employee whistleblower retaliation complaints sent to
1
the appropriate agencies within the Department
Grantee/contractor employee complaints closed after preliminary inquiry 1
Pending grantee/contractor employee complaint investigations 2
Reports pending with DOL 1
Decision issued by the DOL Assistant Secretary for Administration and
1
Management
Semiannual Report to Congress | April 1, 2023–September 30, 2023 109
Legislative
Recommendations
Legislative Recommendations
Legislative Recommendations
The Inspector General Act of 1978, as amended, requires the Office of Inspector General (OIG) to review
existing or proposed legislation and regulations and to make recommendations in the Semiannual Report
to Congress concerning their impact both on the economy and efficiency of the Department’s programs
and on the prevention of fraud, waste, and abuse. The OIG continues to propose the following legislative
actions to increase efficiency and protect the U.S. Department of Labor’s (DOL or Department) programs.
Inspector General Larry D. Turner, in used to prosecute UI fraud have a 5-year
congressional testimonies and through limitation, many groups and individuals that
other means, highlighted four high-priority have defrauded the UI program may escape
recommendations for congressional consideration: justice. Even with the OIG’s tireless efforts,
1. Extend the statute of limitations for fraud the current statute of limitations associated
involving pandemic-related unemployment with UI fraud means federal law enforcement
insurance (UI) programs; may still fall short in fully investigating and
prosecuting the most egregious cases of UI
2. Ensure DOL and the OIG have ongoing,
fraud. This is particularly the case given the
timely, and complete access to UI claimant
volume and complexity of UI fraud matters
data and wage records;
we are tasked to investigate. This issue is
3. Grant the OIG statutory authority to further complicated by our limited resources.
participate in asset forfeiture funds to combat The U.S. Small Business Administration
UI fraud and other crime; and faced a similar issue regarding the statute of
4. Ensure effective payment integrity controls limitations for pandemic-related fraud in the
to reduce improper payments in all UI Paycheck Protection Program and Economic
programs including temporary ones, such Injury Disaster Loan programs. To address
as through broader requirements for those concerns, Congress passed legislation
mandatory cross-matching. to extend associated statutes of limitations.
Details on these and other legislative Congress could likewise act to extend the
recommendations follow. statute of limitations for fraud associated with
pandemic-related UI programs to help ensure
Extend the Statute of Limitations investigators and prosecutors have time to
effectively pursue and hold accountable those
Associated with Pandemic-Related
who defrauded the UI programs during the
UI Fraud
pandemic. To do so, Congress would likely
have to extend the statute of limitations for
Unless Congress acts urgently, the statute of
existing laws when pandemic-related UI
limitations for many of the OIG’s pandemic-related
programs are defrauded.
UI fraud investigations will begin to expire in
early 2025. Because the statutes most often
112 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Legislative Recommendations
Further, for similar reasons, Congress could that limits the Inspector General’s access in
consider extending the federal statute of limitations this manner. Furthermore, in our June 2021
for states to pursue administrative recoveries in alert memorandum,145 we recommended that
cases of proven overpayments, including fraud, the Employment and Training Administration
and with appropriate due process. (ETA) amend its regulations146 to reinforce that
SWAs’ UI information must be provided to the
Allow DOL and the OIG Access to UI OIG for all Inspector General engagements
Claimant Data and Wage Records authorized under the Inspector General
Act of 1978, as amended, including audits,
In addition to the Inspector General Act of evaluations, and investigations.
1978, as amended, Congress should consider
legislative action that would specifically
authorize DOL and the OIG have ongoing,
timely, and complete access to State Workforce
Agencies’ (SWA) UI claimant data and
wage records for our respective oversight
responsibilities. The Department has stated
that, outside of the temporary authority provided
by the Coronavirus Aid, Relief, and Economic
Security Act and subsequent pandemic-related
legislation, it lacks the authority to require SWAs
to provide the OIG with access to UI claimant
data and wage records except when the OIG
is conducting an investigation into a particular
instance of suspected UI fraud.
These barriers to the OIG’s ongoing, timely, and
The Inspector General Act of 1978, as complete access to data has severely hampered
amended, authorizes the Inspector General’s the OIG’s ability to oversee the UI program.
access to information related to the To overcome this and effectively oversee UI
Department’s programs and operations, unless benefits provided in response to the pandemic,
Congress enacts a law that expressly refers to the OIG issued multiple Inspector General
the Inspector General and limits the Inspector subpoenas to all SWAs seeking UI claimant
General’s right of access. The Department data. OIG data scientists then had to ensure
has not provided the OIG with a federal statute the data was complete, consistent, and in a
145 Alert Memorandum: The Employment and Training Administration Needs to Issue Guidance to Ensure State
Workforce Agencies Provide Requested Unemployment Insurance Data to the Office of Inspector General,
Report No. 19-21-005-03-315 (June 16, 2021), available at:
https://www.oig.dol.gov/public/reports/oa/2021/19-21-005-03-315.pdf
146 20 C.F.R. § 603.5 and 603.6(a)
Semiannual Report to Congress | April 1, 2023–September 30, 2023 113
Legislative Recommendations
common format to analyze and identify potential or are receiving benefits improperly due to
fraud and programmatic weaknesses. The systemic program weaknesses.
repeated use of Inspector General subpoenas
to obtain UI data on a recurring basis is Further, data analytics is a vital tool in performing
time-consuming and inefficient. Ongoing, timely, our oversight function. Timely access to UI data
and complete access for all OIG engagements will allow the OIG to use our data analytics
would alleviate that time and resource burden program to identify and investigate complex
and align with the Inspector General Act of identity theft and multistate fraud schemes as
1978, as amended. we have successfully done during the pandemic.
The OIG could also use those records to
While the OIG and ETA agree that changing assess program outcomes for UI reemployment
regulations requires notice and comment programs, as well as other training programs,
rulemaking, an immediate and legally sound such as YouthBuild and Job Corps, where
interim solution is available to ETA. In an alert employment and wage increases are important
memorandum issued September 21, 2022,147 factors in determining a program’s success.
the OIG highlighted DOL’s authority to
amend its interpretation of its regulations To date, ETA has implemented only temporary
without changing the regulations themselves. solutions. In August 2021, ETA issued guidance
Specifically, ETA can issue guidance to inform requiring SWAs to disclose UI data to the OIG
SWAs that they must timely provide UI data for audits and investigations for the duration of
without any constraints to the OIG for audits the pandemic programs. ETA has also required
and investigations consistent with the Inspector sharing of state UI data as a condition of fraud
General Act of 1978, as amended. The historic prevention grants. These grants are expected to
levels of improper payments that the OIG has provide access through 2023. Further, recently
identified, including potential fraud, support the issued guidance supporting additional grants
conclusion that the OIG’s continued access to under the American Rescue Plan Act of 2021
state UI data is imperative. are expected to provide access for the next
2 to 5 years. According to ETA, 52 of 53 SWAs
In support of the OIG’s oversight activities, received grants. ETA stated it was able to require
the OIG needs access to UI claimant data and SWAs to provide UI data to the OIG due to
wage records from SWAs to verify claimants’ temporary authority created by the Coronavirus
eligibility for UI benefits, including both initial Aid, Relief, and Economic Security Act and
eligibility (and amounts) and continuing subsequent pandemic-related legislation.
eligibility. Timely access to these records will
facilitate the OIG’s efforts to identify claimants ETA’s actions are not sufficient to resolve the
who are part of large-scale fraud schemes OIG’s recommendations or concerns.
147 Alert Memorandum: Potentially Fraudulent Unemployment Insurance Payments in High-Risk Areas Increased to
$45.6 Billion, Report No. 19-22-005-03-315 (September 21, 2022), available at:
https://www.oig.dol.gov/public/reports/oa/2022/19-22-005-03-315.pdf
114 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Legislative Recommendations
ETA announced its intent to amend its the UI program and deter fraud. Further, this
regulations to facilitate the OIG’s ongoing action would assist the Department in its
access by February 2025, and, in July 2023, programmatic oversight responsibilities to
requested public comment on potential identify weak controls and improper payments
revisions that would require states to disclose in the UI program.
unemployment compensation data to the
OIG for oversight, including audits. However, To underscore this point, based on the data
until DOL implements a permanent solution, obtained by the OIG, our auditors, investigators,
including revising the regulations ensuring and data scientists collaboratively identified
the OIG’s complete and timely access $46.9 billion dollars in potential fraud paid in
to UI program data and information, the 6 specific high-risk areas, such as to children
Department’s interpretation of its regulations under 14 and deceased persons.148 Also, for
may renew impediments to the OIG’s access the first four high-risk areas, the OIG has
experienced prior to and during the pandemic shared its methodology and underlying data
and necessitate additional subpoenas. with DOL for further dissemination to the SWAs
and is working to share data supporting the
In addition to the Inspector General Act additional high-risk areas. This information
of 1978, as amended, Congress should allows the Department and SWAs to analyze
consider legislative action that would concerning claims and to strengthen controls
specifically authorize DOL and the OIG to detect and deter future fraud. The OIG was
to have ongoing, timely, and complete further able to recommend programmatic
access to UI claimant data and wage changes to put billions in federal funds to better
records for our oversight responsibilities. use. Conducting data analytics from such
access would further enable our auditors to
In addition to the Inspector General Act of identify program weaknesses and recommend
1978, as amended, Congress should consider corrective actions that would improve the
legislative action that would specifically timeliness of UI benefit payments and the
authorize DOL and the OIG to have ongoing, integrity of the UI program.
timely, and complete access to UI claimant
data and wage records for our oversight Authorize OIG Participation in Asset
responsibilities. Ongoing, timely, and complete Forfeiture Funds to Combat UI Fraud
access to SWA UI claimant data and wage and Other Crimes
records systems would further enable the
OIG to quickly identify large-scale fraud and Legislative authority in the area of asset
expand its current efforts to share emerging forfeiture would increase the OIG’s ability to
fraud trends with ETA and states to strengthen effectively and efficiently investigate UI fraud
148 Alert Memorandum: ETA Needs to Incorporate Data Analytics Capability to Improve Oversight of the
Unemployment Insurance Program, Report No. 19-23-012-03-315 (September 25, 2023), available at:
https://www.oig.dol.gov/public/reports/oa/2023/19-23-012-03-315.pdf
Semiannual Report to Congress | April 1, 2023–September 30, 2023 115
Legislative Recommendations
and other crimes and to recover fraudulently provide new and expanded tools and controls for
obtained funds.149 Asset forfeiture is a critical states to help ensure workers are properly paid
legal tool that serves a number of compelling and to prevent improper payments, including
law enforcement purposes. It is designed fraud, in the UI system.
to deprive criminals of the proceeds of their
crimes, to break the financial backbone of The Department stated that the proposals
organized criminal syndicates, and to recover collectively would result in savings of more
property that may be used to compensate than $2 billion over the 10-year budget window.
victims and deter criminal activity. These are similar to DOL proposals included
in prior DOL budget requests that would help
Currently, the OIG is not a participant in the address UI program integrity and the high
U.S. Department of the Treasury Forfeiture improper payment rates in the UI program.
Fund or the U.S. Department of Justice (DOJ) These proposals include the following:
Asset Forfeiture Fund. The lack of authority to • require SWAs to cross-match UI claims
participate limits the OIG’s ability to effectively against the National Directory of New Hires;
recover proceeds of UI fraud and other crimes
• require SWAs to cross-match UI claims with
under the OIG’s jurisdiction. Statutory authority
a system(s) that contains information on
to seize and forfeit illicit funds would allow the
individuals who are incarcerated;
OIG to participate in the U.S. Department of the
Treasury Forfeiture Fund and the DOJ Asset • require states to disclose information to
Forfeiture Fund, thus enabling the OIG to better the OIG;
combat UI fraud and other crimes in the future. • allow SWAs to retain up to 5 percent of
recovered fraudulent UI overpayments for
Enact the UI Integrity Legislative program integrity use;
Proposals • require SWAs to use [UI] penalty and interest
collections solely for UI administration; and
The OIG encourages Congress to consider and
• permit the Department to collect and store
adopt key DOL proposals to aid the Department’s
states’ UI claimant data.
efforts to combat improper payments in the
UI program. In its Fiscal Year (FY) 2024
These legislative proposals are consistent
Congressional Budget Justification,150 the
with previous OIG reporting to improve the UI
Department proposed provisions designed to
program. To maintain UI program integrity, the
149 According to DOJ, forfeiture “is the legal process by which title to an asset is transferred to the government…
because that asset was derived from, used to facilitate, or involved in criminal conduct in a manner that subjects it to
forfeiture under an applicable asset forfeiture statute.” DOJ, Asset Forfeiture Policy Manual (2023), available at:
https://www.justice.gov/criminalafmls/file/839521/download
150 U.S. Department of Labor, FY 2024 Congressional Budget Justification, Employment and Training
Administration, State Unemployment Insurance and Employment Service Operations, available at:
https://www.dol.gov/sites/dolgov/files/general/budget/2024/CBJ-2024-V1-07.pdf
116 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Legislative Recommendations
OIG has recommended establishing legislation employer in complying with H-1B requirements.
that requires SWAs to cross-match high-risk A notice also must be provided to the employer
areas, such as UI benefits paid to individuals to allow a rebuttal of the allegations before the
with Social Security numbers filed in multiple investigation begins.
states and belonging to deceased persons.
Provide Authority to Ensure the
Integrity of the H-1B Program
If DOL is to have a meaningful role in the foreign
labor certification process for H-1B specialty
occupation visas, it must have the statutory
authority to ensure the integrity of that process.
This authority should include the ability to verify
the accuracy of information provided on labor
condition applications and to initiate its own Our concern with the Department’s limited
H-1B investigations more broadly. ability to ensure the integrity of the certification
process is heightened by the results of OIG
Currently, unlike H-2A and H-2B investigations, audits and investigations showing that the
DOL’s authority to investigate H-1B employers program is susceptible to significant fraud and
is limited and typically requires a complaint by abuse, particularly by employers and attorneys.
an aggrieved party. In the absence of such a For example, some staffing companies utilize
complaint, with limited exceptions, DOL may the H-1B program without having scheduled
only initiate its own H-1B investigations if the jobs already lined up. Some employers and
Secretary (or Acting Secretary) personally attorneys misrepresent their need for workers to
certifies there is reasonable cause to believe the DOL, then reassign the extra workers to other
employer is not in compliance. Even assuming companies or require foreign workers to find
that such personal certification is obtained, their own work. There have also been instances
the scope of Secretary-certified investigations when companies illegally generated profits
is limited. These investigations are restricted by requiring foreign workers to pay fees and
to willful, pattern- or practice-, or substantial recurring payments to secure H-1B visas.
violations of the Labor Condition Application
requirements regarding prevailing wage and Without statutory authority, the Department
benefits, working conditions, labor disputes, and generally cannot verify employers’ attestations
notification of applications. to H-1B certifications unless a complaint is filed
or the Department utilizes a Secretary-initiated
Additionally, such an investigation must be investigation. As foreign workers are generally
conducted under specific procedures and reluctant to file complaints for fear of retaliation
may only be initiated for reasons other than and losing their jobs, the Department’s process is
completeness and obvious inaccuracies by the unlikely to result in verification action being taken.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 117
Legislative Recommendations
Amend Pension Protection Laws • Require direct reporting of ERISA
violations to DOL. Under current law,
Legislative changes to the Employment a pension plan auditor who finds a
Retirement Income Security Act of 1974 (ERISA) potential ERISA violation is responsible
and criminal penalties for ERISA violations for reporting it to the plan administrator,
would enhance the protection of assets in but not directly to DOL. To ensure
pension plans. To this end, the OIG continues to that improprieties are addressed, we
recommend the following legislative actions: recommend that plan administrators or
• Repeal ERISA’s limited-scope audit auditors be required to report potential
exemption. This exemption excludes ERISA violations directly to DOL. This
pension plan assets invested in financial change would ensure the timely reporting
institutions, such as banks and savings and of violations and would more actively
loan firms, from audits of employee benefit involve auditors in safeguarding pension
plans. Notwithstanding recent changes assets as a first line of defense against
to auditing standards that strengthen the abuse of workers’ pension plans.
limited-scope audits, these audits prevent • Strengthen criminal penalties in U.S.C.
independent public accountants who are Title 18. Three sections of U.S.C. Title 18
auditing pension plans from rendering an serve as the primary criminal enforcement
opinion on the plans’ financial statements tools for protecting pension plans
in accordance with professional auditing covered by ERISA. Section 664 sets
standards. These “no opinion” audits offer penalties for embezzlement or theft from
weak assurance of asset integrity either to employee pension and welfare plans;
plan participants or to the Department. Section 1027 sets penalties for making false
• Expand the authority of the Employee statements in documents required by ERISA;
Benefits Security Administration to and Section 1954 sets penalties for giving
correct substandard benefit plan or accepting bribes related to the operation
audits and ensure that auditors of ERISA-covered plans. Sections 664
with poor records do not perform and 1027 subject violators to up to 5 years’
additional audits. Changes should include imprisonment while Section 1954 calls for
providing the Employee Benefits Security up to 3 years’ imprisonment for violators.
Administration with greater enforcement The OIG recommends raising the maximum
authority over registration, suspension, and penalty up to 10 years for all three violations
debarment as well as the ability to levy civil to correspond with the 10-year penalty
penalties against employee benefit plan imposed by Section 669 (for theft from
auditors. The ability to correct substandard health care benefit programs). An increased
audits and take action against auditors is penalty would serve as a greater deterrent
essential as benefit plan audits help protect and, consequently, further protect employee
participants and beneficiaries by ensuring pension plans.
the proper valuation of plan assets and
computation of benefits.
118 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Legislative Recommendations
Improve the Integrity of the
FECA Program
Legislative reforms should be considered in the
following areas to improve the effectiveness
and integrity of the Federal Employees’
Compensation Act (FECA) program:
• Provide statutory access to the National
Directory of New Hires and Social
Security wage records. Currently, the
Department has no access to the National
Directory of New Hires data and can access
Social Security wage information only if
the claimant gives it permission. Granting
the Department routine access to these
databases would aid in detecting fraud
committed by individuals receiving FECA
wage loss compensation but failing to report
income they have earned.
• Establish a 3-day waiting period at the • Allow the temporary suspension of
beginning of the claims process. medical providers pending the outcome
FECA legislation provides for a 3-day of criminal investigations. While FECA
waiting period, which is intended to regulations allow the Office of Workers’
discourage the filing of frivolous claims. Compensation Programs to exclude a
As currently written, however, the legislation provider through administrative means, the
places the waiting period at the end of Office of Workers’ Compensation Programs
the 45-day continuation-of-pay period, must give notice to the provider and afford
thereby negating its purpose. Legislation the provider an opportunity for a hearing
that passed in 2006 placed the waiting before DOL’s Office of Administrative Law
period for postal employees immediately Judges. This process and the various
after an employment-related injury. If the procedures involved can be lengthy.
intent of the law is to ensure a true waiting Legislative changes are necessary to
period before an employee applies for enable DOL to immediately suspend all
benefits, then that period should likewise medical providers who have been indicted
come immediately after an employment- for fraudulent billing practices from providing
related injury—for all federal workers, not further medical services and receiving
exclusively postal employees. This proposal payments. This proposal was included in the
was included in the President’s FY 2021 President’s FY 2021 budget as part of the
budget as part of the Office of Workers’ Office of Workers’ Compensation Programs’
Compensation Programs’ FECA reform. FECA reform.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 119
Appendices
Appendices
Reporting Requirements Under
the Following Acts
The Inspector General Act of 1978, as Amended
REPORTING REQUIREMENT PAGE
Recommendations on existing and proposed legislation and regulations relating to the
Section 4(a)(2) 111
programs and operations of DOL
Description of significant problems, abuses, and deficiencies relating to the administration
Section 5(a)(1) of programs and operations of the establishment and associated reports and All
recommendations for corrective action made by the Office
Identification of each recommendation made before the reporting period, for which
Section 5(a)(2) corrective action has not been completed, including the potential costs savings associated All
with the recommendation
Section 5(a)(3) Summary of significant investigations closed during the reporting period 74-96
Identification of the total number of convictions during the reporting period resulting from
Section 5(a)(4) 149
investigations
Information regarding each audit, inspection, or evaluation report issued during the
reporting period, including—
(A) a listing of each audit, inspection, or evaluation;
Section 5(a)(5) (B) if applicable, the total dollar value of questioned costs (including a separate category 126
for the dollar value of unsupported costs) and the dollar value of recommendations that
funds be put to better use, including whether a management decision had been made by
the end of the reporting period
Information regarding any management decision made during the reporting period with
Section 5(a)(6) 131
respect to any audit, inspection, or evaluation issued during a previous reporting period
Information from the Federal Financial Management Improvement Act Section 804(b) —
None to
Section 5(a) (7) instances in which an agency has not met intermediate target dates in a remediation plan,
report
and the reasons
Peer review reporting:
Section 5(a)(8) (A) results of any peer review conducted by another OIG, or 151
(B) a statement identifying the date of the last peer review conducted
continued on next page
122 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
None to
Section 5(a)(9) Outstanding peer review recommendations
report
Peer reviews conducted by the OIG and recommendations outstanding or not fully None to
Section 5(a)(10)
implemented report
Statistical tables on investigative findings showing total number of:
(A) reports issued;
(B) persons referred to the U.S. Department of Justice for prosecution;
Section 5(a)(11) 149
(C) persons referred to state and local prosecuting authorities; and
(D) indictments and criminal informations that resulted from any prior referral to
prosecuting authorities
Section 5(a)(12) Metrics used for developing the data for the statistical tables 149
Summary of investigations of senior government employees where allegations of
Section 5(a)(13) misconduct were substantiated, including the facts, circumstances, status, and disposition 105
of the matter
Description of whistleblower retaliation cases including information about the official found
Section 5(a)(14) to have engaged in retaliation and what, if any, consequences that establishment imposed 107
to hold that official accountable
Information related to interference by the establishment, including—
(A) a detailed description of any attempt by the establishment to interfere with the
independence of the Office, including—
Section 5(a)(15) (i) with budget constraints designed to limit the capabilities of the Office; and
None to
and Section 6(c) (ii) incidents where the establishment has resisted or objected to oversight activities of the
report
(2) Office or restricted or significantly delayed access to information, including the justification
of the establishment for such action; and
(B) a summary of each report made to the head of the establishment under section 6(c)
(2) during the reporting period
(A) Descriptions of inspections, evaluations, audits, and investigations that are closed and
were not disclosed to the public; and None to
Section 5(a)(16)
(B) Descriptions of investigations conducted by the office involving a senior government report
employee that are closed and were not disclosed to the public
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
REPORTING REQUIREMENT PAGE
Section 989(C) Peer review reporting 151
Semiannual Report to Congress | April 1, 2023–September 30, 2023 123
Appendices
Funds Recommended for Better Use
Funds Put to a Better Use Agreed to by DOL151
Number Dollar Value
of Reports ($ millions)
For which no management decision had been made as of the commencement of the reporting
1 $29,600
period
Issued during the reporting period 3 $6,300
Subtotal 1 $35,900
For which a management decision was made during the reporting period:
• Dollar value of recommendations that were agreed to by management 0 $0
• Dollar value of recommendations that were not agreed to by management 0 $0
For which no management decision had been made as of the end of the reporting period 4 $35,900
Funds Put to a Better Use Implemented by DOL
Number Dollar Value
of Reports ($ millions)
For which final action had not been taken as of the commencement of the reporting period 3 $39,310
For which management or appeal decisions were made during the reporting period 0 $0
Subtotal 3 $39,310
For which management decision was made during the reporting period:
• Dollar value of recommendations that were actually completed 0 $0
• Dollar value of recommendations that management has subsequently concluded should not or
0 $0
could not be implemented or completed
For which no final action had been taken by the end of the period 3 $39,310
151 The term “recommendation that funds be put to better use” means a recommendation by the OIG that funds
could be used more efficiently or achieve greater program effectiveness if management took actions to implement
and complete the recommendation. This term is defined by the Inspector General Act of 1978, as amended, and
includes, among other things, reductions in future outlays; deobligation of funds from programs or operations;
costs not incurred in the future by implementing recommended improvements related to the operations of the
establishment, a contractor, or a grantee; and any other savings specifically identified, including reverting funds to
Treasury to be used for other purposes.
124 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Questioned Costs
Resolution Activity: Questioned Costs152
Questioned
Number
Costs
of Reports
($ millions)
For which no management decision had been made as of the commencement of the reporting
1 $321
period (as adjusted)
Issued during the reporting period 4 $278
Subtotal 5 $599
For which a management decision was made during the reporting period:
• Dollar value of disallowed costs 0 $0
• Dollar value of costs not disallowed 0 $0
For which no management decision had been made as of the end of the reporting period 5 $599
For which no management decision had been made within six months of issuance 0 $0
Closure Activity: Disallowed Costs153
Disallowed
Number
Costs
of Reports
($ millions)
For which final action had not been taken as of the commencement of the reporting period (as
0 $0
adjusted)
For which management or appeal decisions were made during the reporting period 0 $0
Subtotal 0 $0
For which final action was taken during the reporting period:
• Dollar value of disallowed costs that were recovered 0 $0
• Dollar value of disallowed costs that were written off 0 $0
• Dollar value of disallowed costs that entered appeal status 0 $0
For which no management decision had been made within six months of issuance 0 $0
152 As defined by the Inspector General Act of 1978, as amended, questioned costs include alleged violations
of law, regulations, contracts, grants, or agreements; costs not supported by adequate documentation; or the
expenditure of funds for an intended purpose that was unnecessary or unreasonable.
153 Disallowed costs are costs that the OIG questioned during an audit as unsupported or unallowable and that the
grant/contracting officer has determined the auditee should repay. The Department is responsible for collecting the
debts established. The amount collected may be less than the amount disallowed, and monies recovered usually
cannot be used to fund other program operations and are returned to Treasury.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 125
Appendices
Final Audit Reports Issued
Number of Questioned Costs
Management
Funds Put To Decision Made by
Report Title; Report Number; Date Issued
Recommendations ($)
Better Use ($)
End of Reporting
Period
Employment and Training Administration
Tracking the Department of Labor’s Unemployment Insurance
No Response
Response to Local Communities during the Pandemic; 0 $0 $0
Required
Report No. 19-23-007-03-315; 07/10/23
ETA Did Not Provide Adequate Oversight of Emergency
Administrative Grants; 3 $136,353,568 $0 Yes
Report No. 19-23-006-03-315; 07/27/23
COVID-19: Audit of State Workforce Agencies’ Information Technology
No Response
Systems Capability in Processing Unemployment Insurance Claims; 0 $0 $0
Required
Report No. 19-23-008-03-315; 09/19/23
COVID-19: Unemployment Relief for Governmental Entities and
Nonprofit Organizations Should Have Been Better Managed; 3 $29,074,061 $0 No
Report No. 19-23-010-03-315; 09/21/23
COVID-19: ETA Can Improve its Oversight to Ensure Integrity over
CARES Act UI Programs; 3 $0 $0 No
Report No. 19-23-011-03-315; 09/22/23
Alert Memorandum: ETA Needs to Incorporate Data Analytics
Capability to Improve Oversight of the Unemployment Insurance
3 $0 $1,292,205,723 No
Program;
Report No. 19-23-012-03-315; 09/25/23
COVID-19: Pandemic Unemployment Assistance for Non-Traditional
Claimants Weakened by Billions in Overpayments Including Fraud; 3 $0 $0 No
Report No. 19-23-014-03-315; 09/27/23
COVID-19: ETA Needs a Plan to Reconcile and Return to the
U.S. Treasury Nearly $5 Billion Unused by States for a Temporary
8 $105,100,000 $4,948,811,006 No
Unemployment Insurance Program;
Report No. 19-23-015-03-315; 09/28/23
COVID-19: The Employment and Training Administration Needs to
Improve Oversight of Grants Awarded in New Jersey; 7 $7,165,040 $100,098,923 No
Report No. 19-23-016-03-391; 09/28/23
Total (9 Reports)
continued on next page
126 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Occupational Safety and Health Administration
COVID-19: OSHA Needs to Strengthen Its Process for Awarding
Future Emergency Supplemental Funds to State Plans; 2 $0 $0 Yes
Report No. 19-23-009-10-105; 08/30/23
COVID-19: OSHA Needs to do More to Address High Injury Rates of
7 $0 $0 No
Warehouse Workers; Report No. 19-23-013-10-105; 09/27/23
Total (2 Reports)
Office of the Assistant Secretary for Administration and Management
Memorandum: U.S. Department of Labor’s Purchase and Travel Card
No Required
Risks Assessed as Low and Moderate; 0 $0 $0
Response
Report No. 22-23-007-50-598; 08/30/23
Total (1 Report)
Office of the Chief Financial Officer
The U.S. Department of Labor Did Not Meet the Requirement for
Compliance with the Payment Integrity Information Act for Fiscal Year 3 $0 $0 Yes
2022; Report No. 22-23-006-13-001; 6/9/23
Total (1 Report)
Office of Workers’ Compensation Programs
Service Auditors’ Report on the Integrated Federal Employees’
Compensation System; Service Auditors’ Report on Optum Workers’
Compensation and Auto No-Fault’s Retail Pharmacy Network Services No Response
0 $0 $0
System; and Service Auditors’ Report on the U.S. Department of Labor Required
Workers’ Compensation Medical Bill Processing System;
Report No. 22-23-008-04-431; 09/20/23
Total (1 Reports)
Final Audit Total (14 Reports) 42 $277,692,669 $6,341,115,652
Semiannual Report to Congress | April 1, 2023–September 30, 2023 127
Appendices
Other Reports
Management Decision
Number of
Report Title; Report Number; Date Issued Made by End of
Recommendations
Reporting Period
Employment and Training Programs
Workforce Innovation and Opportunity Act
Quality Control Review for the Single Audit of the Puerto Rico Department
of Economic Development and Commerce for the Fiscal Year Ended
0 No Response Necessary
June 30, 2021;
Report No. 24-23-004-50-598; 09/19/23
Quality Control Review for the Single Audit of South Carolina Department of
Employment Workforce for the Year Ended June 30, 2021; 7 No
Report No. 24-23-003-50-598; 09/26/23
Quality Control Review for the Single Audit of the Center for Workforce
Inclusion, Inc., for the Fiscal Year Ended June 30, 2022; 0 No Response Necessary
Report No. 24-23-005-50-598; 09/27/23
Total (3 Reports)
Other Reports Total (3 Reports) 7
128 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Unresolved Audit Reports Over 6 Months Old
Number of Unimplemented
Questioned
Agency Report Title; Report Number; Date Issued
Recommendations
Costs ($)
Agency Management Decision or Grant/Contracting Officer’s Final Determination Did Not Resolve;
OIG Negotiating with Agency
COVID-19: More Can Be Done to Mitigate Risk to Unemployment Compensation
ETA Under the CARES Act; 1 $0
Report No. 19-20-008-03-315; 08/07/20
Alert Memorandum: The Employment and Training Administration Needs to Issue
Guidance to Ensure State Workforce Agencies Provide Requested Unemployment
ETA 2 $0
Insurance Data to the Office of Inspector General;
Report No. 19-21-005-03-315; 06/16/21
Unemployment Insurance Overpayments Related to Work Search Underscore the
ETA Need for More Consistent State Requirements; 1 $0
Report No. 04-21-001-03-315; 09/29/21
Alert Memorandum: The Employment and Training Administration Needs to Ensure
State Workforce Agencies Report Activities Related to CARES Act Unemployment
ETA 1 $0
Insurance Programs;
Report No. 19-22-004-03-315; 08/02/22
Alert Memorandum: Potentially Fraudulent Unemployment Insurance Payments in
ETA High Risk Areas Increased to $45.6 Billion; 2 $0
Report No. 19-22-005-03-315; 09/21/22
COVID-19: ETA and States Did Not Protect Pandemic-Related UI Funds from
ETA Improper Payments Including Fraud or from Payment Delays; 2 $0
Report No. 19-22-006-03-315; 09/30/22
MSHA Needs to Provide Better Oversight of Emergency Response Plans;
MSHA 2 $0
Report No. 05-17-002-06-001; 03/31/17
MSHA Did Not Evaluate Whether Civil Monetary Penalties Effectively Deterred
MSHA Unsafe Mine Operations; 2 $0
Report No. 23-19-002-06-001; 08/16/19
Office of
Assistant [Federal Information Security Modernization Act of 2014 (FISMA)] Fiscal Year 2015:
Secretary for Ongoing Security Deficiencies Exist; 1 $0
Administration Report No. 23-16-002-07-725; 09/30/16
and Management
continued on next page
Semiannual Report to Congress | April 1, 2023–September 30, 2023 129
Appendices
Office of Federal
OFCCP Did Not Show It Adequately Enforced EEO Requirements on Federal
Contracting
Construction Contracts; 1 $0
Compliance
Report No. 04-20-001-14-001; 03/27/20
Programs
DOL’s IT Governance Lacked the Framework Necessary to Support the Overall
Office of the
Mission; 1 $0
Secretary
Report No. 23-21-002-01-001; 09/30/21
OWCP Did Not Ensure Best Prices and Allowed Inappropriate, Potentially Lethal
OWCP Prescriptions in the FECA Program; 6 $321,261,486
Report No. 03-23-001-04-431; 03/31/23
Agency Management Decision or Grant/Contracting Officer’s Final Determination Not Issued By Close of Period
Total Nonmonetary Recommendations and Questioned Costs 22 $321,261,486
Number of Funds Recommended for
Agency Report Title; Report Number; Date Issued
Better Use ($)
Recommendations
Agency Management Decision or Grant/Contracting Officer’s Final Determination Did Not Resolve;
OIG Negotiating with Agency
Alert Memorandum: Potentially Fraudulent Unemployment Insurance Payments in
ETA High Risk Areas Increased to $45.6 Billion; 1 $29,581,490,253
Report No. 19-22-005-03-315; 09/21/22
Total Funds Recommended for Better Use 1 $29,581,490,253
Total Audit Exceptions and Questioned Costs 22 $321,261,486
Total Funds Recommended for Better Use 1 $29,581,490,253
Total Audit Exceptions and Funds Recommended for Better Use 23 $29,902,751,739
130 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Management Decision Made During this
Reporting Period on Audits, Inspections,
or Evaluations Issued during a Previous
Reporting Period: Final Audit Reports Issued
Funds Put to Better Use
Management Decision
Questioned Costs ($)
Number of
Made on Previously
Report Title; Report Number; Date Issued
($)
Recommendations
Issued Audits
Employment and Training Administration
Alert Memorandum: ETA and States Need to Ensure the Use
of Identity Verification Service Contractors Results in Equitable
Access to Unemployment Insurance Benefits and Secure 3 $0 $0 Yes
Biometric Data;
Report No. 19-23-005-03-315; 3/31/23
Total (1 Report)
Office of the Chief Financial Officer
FY 2022 DOL’s Consolidated Financial Statements Report;
3 $0 $0 Yes
Report No. 22-23-002-13-001; 12/13/22
DOL FY 2022 Management Advisory Comments;
8 $0 $0 Yes
Report No. 22-23-005-13-001; 1/30/23
Total (2 Reports)
Office of the Chief Information Officer
FY 2022 FISMA DOL Information Security Report;
8 $0 $0 Yes
Report No. 23-23-001-07-725; 2/10/23
Total (1 Report)
continued on next page
Semiannual Report to Congress | April 1, 2023–September 30, 2023 131
Appendices
Occupational Safety and Health Administration
COVID-19: OSHA’s Enforcement Activities Did Not Sufficiently
Protect Workers from Pandemic Health Hazards; 5 $0 $0 Yes
Report No. 19-23-001-10-105; 10/31/22
OSHA Needs to Better Address Complaints and Referrals for
Increased Worker Safety; 3 $0 $0 Yes
Report No. 02-23-001-10-105; 3/6/23
Total (2 Reports)
Office of Workers’ Compensation Programs
Special Report Relating to the Federal Employees’ Compensation No
Act Special Benefit Fund September 30, 2022; 0 $0 $0 Response
Report No. 22-23-001-04-431; 11/3/22 Required154
COVID-19: Insights on Telehealth Use and Program Integrity Risks No
in DOL Workers’ Compensation Programs during the Pandemic; 0 $0 $0 Response
Report No. 19-23-002-04-001; 12/13/22 Required
FY 2021 Longshore and Harbor Workers’ Compensation Act
No
Special Fund Financial Statements and Independent Auditors’
0 $0 $0 Response
Report;
Required
Report No. 22-23-003-04-432; 2/22/23
FY 2021 District of Columbia Workmen’s Compensation Act
Special Fund Financial Statements and Independent Auditors’
2 $0 $0 Yes
Report;
Report No. 22-23-004-04-432; 2/22/23
OWCP Did Not Ensure Best Prices and Allowed Inappropriate,
Potentially Lethal Prescriptions in the FECA Program; 10 $321,261,486 $0 Yes
Report No. 03-23-001-04-431; 3/31/23
Total (5 Reports)
Final Audit Total (11 Reports) 42 $321,261,486 $0
154 The notation of “No Response Required” indicates that no management decision was due from the agency
because the report issued had no recommendations.
132 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Management Decision Made During this
Reporting Period on Audits, Inspections,
or Evaluations Issued during a Previous
Reporting Period: Other Reports Issued
Management
Number of Decision Made by
Report Title; Report Number; Date Issued
Recommendations End of Reporting
Period
Employment and Training Programs
Workforce Innovation and Opportunity Act
Quality Control Review Single Audit of State of New Mexico Workforce Solutions
Department for The Year Ended June 30, 2021; 2 No
Report No. 24-23-001-50-598; 3/7/23
Quality Control Review Single Audit of Service, Employment, and Redevelopment
No Response
Jobs for Progress National, Inc. for The Year Ended June 20, 2022; 0
Required
Report No. 24-23-002-50-598; 3/30/23
Total (2 Reports)
Congressional Testimony
Testimony before the U.S. House of Representatives Committee on Ways and Means
The Greatest Theft of American Tax Dollars: Unchecked Unemployment Fraud; No Response
0
Report No. 19-23-003-03-315; 2/8/23 Required
Testimony before the U.S. House of Representatives Committee on Oversight and Accountability Subcommittee on
Government Operations and the Federal Workforce
Waste, Fraud, and Abuse Go Viral: Inspectors General on Curing the Disease; No Response
0
Report No. 19-23-004-03-315; 3/9/23 Required
Total (2 Reports)
Other Reports Total (4 Reports) 2
Semiannual Report to Congress | April 1, 2023–September 30, 2023 133
Appendices
Corrective Actions Taken by the Department
During this reporting period, we took final action to close recommendations within reports based on
corrective action taken by the Department. The following is a summary of the most significant actions.
Alert Memorandum: The Employment and Training Administration Needs
to Issue Guidance to Ensure State Workforce Agencies Provide Requested
Unemployment Insurance Data to the Office of Inspector General;
Report No. 19-21-005-03-315; 06/16/21
During the OIG’s pandemic oversight work, ETA sought coordination with the OIG on pandemic-related
UI information disclosure guidance to SWAs. However, the guidance would limit the OIG’s access to
claims data for investigative purposes only. The OIG highlighted that ETA’s guidance would hinder
recurring SWA UI data access for audits. Despite this feedback, ETA neither revised its guidance
nor introduced new guidance, citing a lack of authority to mandate that SWAs to share UI data with
the OIG.
Due to these limitations, the OIG issued an alert memorandum emphasizing that, while ETA’s
guidance limited UI data sharing with the OIG to specific fraud investigations, the Inspector
General Act of 1978, as amended, authorizes broader access to combat fraud, waste, and abuse.
Additionally, ETA’s pre-pandemic guidance mandates a prior agreement with the OIG before sharing
confidential UI information. Therefore, we recommended the Principal Deputy Assistant Secretary
of Employment and Training amend 20 C.F.R. § 603.5 and 603.6(a) through the rulemaking process
to reinforce that UI information must be provided to the OIG for all Inspector General engagements
authorized under the Inspector General Act of 1978, as amended, including audits, evaluations, and
investigations.
In July 2023, DOL initiated the process to amend C.F.R. Part 603. ETA called for input on the
disclosure of confidential wage records in the context of state unemployment compensation
information confidentiality regulations. This move aimed to potentially update the regulations
considering advancements in IT and the public workforce system concerning the disclosure of
confidential unemployment compensation data. Although not yet conclusive, this development is a
significant stride towards addressing a crucial OIG recommendation.
134 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
COVID-19: States Struggled to Implement CARES Act Unemployment Insurance
Programs; Report No. 19-21-004-03-315; 05/28/21
On March 27, 2020, Congress passed the CARES Act to provide expanded UI benefits to workers
directly affected by the COVID-19 pandemic, necessitating both ETA and states implement major
changes to the existing UI systems. In our audit of how DOL and states implemented key CARES
Act UI programs, we found states faced challenges in promptly implementing programs and
adhering to ETA’s payment standards. There were varying delays across programs, and many
states did not meet the 14- or 21-day promptness criteria for regular UI payments. Consequently, we
recommended that the Principal Deputy Assistant Secretary for Employment and Training establish
standards to offer clear and reasonable timeframes for the implementation of temporary programs,
ensuring prompt benefit payments to claimants.
By November 2022, ETA confirmed its new practice of providing reasonable timeframes in recent
guidelines for states. For instance, three Unemployment Insurance Program Letters included
directives about the timeline for implementing changes to pandemic related UI programs. We closed
this recommendation based on ETA’s actions taken.
COVID-19: Alert Memorandum: ETA and States Need to Ensure the Use of
Identity Verification Service Contractors Results in Equitable Access to UI
Benefits and Secure Biometric Data; Report No. 19-23-005-03-315; 3/31/2023
Resulting from the economic impact of the COVID-19 pandemic, UI programs have become a target
for fraud with significant numbers of imposter claims being filed with stolen or synthetic identities. To
combat these imposter claims, 24 out of 53 SWAs (45 percent) hired a total of 10 identity verification
service contractors that utilized facial recognition technology.
We issued an alert memorandum detailing concerns that the use of identity verification service
contractors may not result in equitable and secure access to UI benefits in the processing of
UI claims. Consequently, we recommended that the Principal Deputy Assistant Secretary for
Employment and Training offer guidance to SWAs on providing fair alternatives to facial recognition,
mandate bias testing and reporting for such technology, and ensure contracts with verification
providers prioritize data security and regular purging.
In April 2023, ETA promptly issued guidance to states via Unemployment Insurance Program
Letter No. 22-21, Change 2, highlighting SWA obligations under 29 C.F.R. § 38.51. The guidance
emphasized testing facial recognition systems for biases and collaborating with providers to address
these issues. By June 2023, in follow-up guidance, Unemployment Insurance Program Letter
09-23, ETA mandated states disclose bias testing results and continually update measures to rectify
identified biases. We closed this recommendation based on ETA’s actions taken.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 135
Appendices
MSHA Needs to Improve Efforts to Protect Coal Miners from Respirable
Crystalline Silica; Report No. 05-21-001-06-001; 11/12/2020
More than three times as many coal miners were identified as having black lung disease from
2010-2014 when compared to the late 1990s (1995-1999). The evidence indicates respirable
crystalline silica (silica)—a carcinogen and contributing cause of black lung disease—may be
responsible for this increase. The Federal Mine Safety and Health Act of 1977 requires MSHA to set
standards based on the best available evidence to protect miners from exposure to toxic materials
or harmful agents. However, over the past four decades, various stakeholders have raised concerns
about miners’ exposures to silica.
Our audit found MSHA had not sufficiently protected coal miners from exposure to silica. MSHA’s
silica exposure limit was out of date, MSHA could not cite and fine mine operators for excess silica
exposures alone, and MSHA’s sampling for silica may be too infrequent to be sufficiently protective.
On July 13, 2023, MSHA issued a proposed rule in the Federal Register, Volume 88, Number 133,
titled “Lowering Miners’ Exposure to Respirable Crystalline Silica and Improving Respiratory
Protection (RIN 1219–AB36).” In the proposed rule, MSHA proposed a permissible exposure limit
of 50 micrograms per cubic meter of air during a full shift, calculated as an 8-hour time-weighted
average for coal, metal and nonmetal miners, and an action level of 25 milligrams per cubic meter of
air for silica exposure. The proposed rule also states:
[t]he adoption of a separate standard would hold operators accountable, at risk of a citation and
monetary penalty, when overexposures of the respirable crystalline silica permissible exposure
limit occur and enhance its sampling program to increase the frequency of operator sampling.
This proposed rule would add to Title 30 C.F.R. Part 60 to allow MSHA to issue a citation and
monetary penalty when violations of its silica exposure limit occur. Although not yet finalized, this
proposed rule is a significant stride towards addressing crucial OIG recommendations.
136 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Region IX Whistleblower Protection Program Complaints Were Not Complete or
Timely; Report No. 02-21-001-10-105; 11/23/2020
On July 6, 2018, then-Secretary of Labor Alexander Acosta received a referral from the U.S. Office
of Special Counsel that described allegations against the OSHA Whistleblower Protection Program.
The program investigates complaints of employer retaliation when employees report violations
of law by their employers. The whistleblower in the U.S. Office of Special Counsel’s referral was
an investigator for OSHA from 2010 to 2015. The whistleblower alleged OSHA’s Region IX had
breakdowns processing the complaints it received, which, in turn, resulted in widespread failure to
protect complainants.
Our audit found OSHA’s current database was not an effective tool to ensure the essential elements
of the investigation were completed by investigators. Moreover, the database did not flag periods
of inactivity on an investigation to prompt the investigator to proceed with the next element and
maintain contact with the complainant and respondent. In response to our audit, OSHA:
• Completed and launched the Whistleblower OSHA Information System database module, which
highlights periods of inactivity during an ongoing investigation to investigators and supervisors. It
monitors and tracks periods of inactivity via three methods:
1. open cases with the number of days open for each case are displayed in a dashboard on the
OSHA Information System landing page for the investigator and supervisor;
2. a Pending Investigation and Intake report is available for users to generate, which will provide
a list of open cases with various indicators including number of days pending and last diary
event date and notes; and
3. through the Complaint Search function in which the search results provide a list of cases with
indication of the last updated date and time for each case.
• Implemented an investigative checklist for regional management to ensure essential elements
were completed before closing an investigation.
We closed this recommendation based on the proven solution OSHA implemented to improve
case management.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 137
Appendices
Unimplemented Recommendations
During this reporting period, there were no instances of audits or evaluations provided to the Department
for comment that were not responded to within 60 days. Management decisions were received in
response to all audits and evaluations issued before the commencement of this reporting period.
From October 1, 2011, through March 31, 2023, the OIG made 1,761 audit recommendations, of which 160
have not been fully implemented. These 160 recommendations include 109 recommendations resulting from
audits issued since the end of FY 2020, and, in many cases, the corrective action plans are in place.
RECOMMENDATIONS MADE PRIOR TO APRIL 1, 2023, NOT YET IMPLEMENTED
Unimplemented Recommendations
Total Number of
Fiscal Year
Recommendations Made
Total Number Monetary Impact ($)
2011 319 6 $0
2012 213 0 $0
2013 195 0 $0
2014 128 1 $0
2015 163 2 $0
2016 100 1 $0
2017 112 8 $0
2018 98 1 $0
2019 84 19 $0
2020 105 13 $0
2021 133 47 $39,311,226,638
2022 67 26 $29,581,490,253
2023155 44 36 $321,261,486
Total 1,761 160 $69,213,978,377
155 FY 2023 shows data for the first half of the fiscal year (October 1, 2022, to March 31, 2023).
138 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
High-Priority Unimplemented Recommendations
The following table summarizes the unimplemented recommendations the OIG considers to be the
highest priorities for the Department.
Report Title; Report Number;
Unimplemented Recommendation(s)
Date Issued
Unemployment Insurance Benefits
COVID-19: More Can Be Done to Include CARES Act UI transactions in the Benefit Accuracy Measurement (BAM) or
Mitigate Risk to Unemployment develop an alternative methodology to reliably estimate improper payments for those
Compensation Under the CARES Act; programs;156
Report No. 19-20-008-03-315; 08/07/20 Issue guidance directing states to provide access to state UI claimant data to prevent and
detect fraud.
Alert Memorandum: The Employment Establish effective controls, in collaboration with SWAs, to mitigate fraud and other
and Training Administration (ETA) improper payments to ineligible claimants, including the areas identified in the
Needs to Ensure State Workforce memorandum: UI benefits paid to multistate claimants, claimants who used the Social
Agencies (SWA) Implement Effective Security numbers of deceased individuals, potentially ineligible federal inmates, and
Unemployment Insurance Program claimants with suspicious email accounts. Effective controls will help prevent similar
Fraud Controls for High Risk Areas; or greater amounts of fraud and allow those funds to be put to better use; Work with
Report No. 19-21-002-03-315; 02/22/21 Congress to establish legislation requiring SWAs to cross-match high-risk areas,
including the four areas identified in the memorandum.
COVID-19: States Struggled to Continue to work with states to develop, operate, and maintain a modular set of
Implement CARES Act Unemployment technological capabilities to modernize the delivery of UI benefits that is sufficient to
Insurance Programs; manage and process sudden spikes in claims volume during emergencies or high
Report No. 19-21-004-03-315; 05/28/21 unemployment.
Alert Memorandum: The Employment Amend 20 C.F.R. 603.5 and 603.6(a) through the rulemaking process to reinforce that UI
and Training Administration Needs information must be provided to DOL OIG for all IG engagements authorized under the IG
to Issue Guidance to Ensure State Act, including audits, evaluations, and investigations.
Workforce Agencies Provide Requested
Unemployment Insurance Data to the
Office of Inspector General;
Report No. 19-21-005-03-315; 06/16/21
Alert Memorandum: The Employment Take immediate action to require the National Association of State Workforce Agencies to
and Training Administration Does Not refer information to ETA and the OIG on suspected fraud, waste, abuse, mismanagement,
Require the National Association of State or misconduct, per Department of Labor Manual Series (DLMS) 8-106(D)(3). Such
Workforce Agencies to Report Suspected actions could include modification of ETA’s grant award or issuance of unemployment
Unemployment Insurance Fraud Data insurance program policy guidance to ensure ETA complies with the notice requirement
to the Office of Inspector General or the and its grantees comply with the reporting requirements of the DLMS;
Employment and Training Administration; Continue to work with the OIG and, within 30 days of this memorandum, meet with the
Report No. 19-21-006-03-315; 07/01/21 OIG to develop a permanent approach to OIG access to IDH data.
continued on next page
156 These programs are: PUA, PEUC, FPUC, TFFF, EURGENO, and Temporary Financing of Short-Time Compensation.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 139
Appendices
Alert Memorandum: The Employment Continue to identify states that have not complied with ETA’s reporting requirements for
and Training Administration Needs CARES Act UI programs and work with them to ensure missing reports and information
to Ensure State Workforce Agencies are submitted before commencement of the Department’s FY 2022 financial statement
Report Activities Related to CARES Act audit;
Unemployment Insurance Programs; Verify the accuracy of reports that cite no activity and ensure corrections are made where
Report No. 19-22-004-03-315; 08/02/22 warranted.
Alert Memorandum: Potentially Fraudulent Implement immediate measures to ensure SWAs are required to provide ongoing access
Unemployment Insurance Payments to the OIG by amending its current guidance to require disclosures to the OIG for audits
in High-Risk Areas Increased to $45.6 and investigations as necessary, mandatory, and without time limitation for the proper
Billion; oversight of the UI program;
Report No. 19-22-005-03-315; 9/21/22 Expedite OIG-related amendments to 20 C.F.R. § 603.6(a) to make ongoing disclosures
of UI information to DOL OIG mandatory by expressly adding the U.S. Department of
Labor, Office of Inspector General (including its agents and contractors) to the list of
required disclosures that are necessary for the proper oversight of the UI program without
distinction as to purpose (e.g., audits versus investigations);
Expedite OIG-related amendments to 20 C.F.R. § 603.5(i) to expressly make disclosures
of UI information to federal officials for oversight, audits, and investigations of federal
programs mandatory.
COVID-19: ETA and States Did Not Use data collected from monitoring and BAM reports to identify the areas of highest
Protect Pandemic-Related UI Funds from improper payments including fraud and create a plan to prevent similar issues in future
Improper Payments Including Fraud or temporary UI benefit programs;
from Payment Delays; Require states to have written policies and procedures, which apply lessons learned
Report No. 19-22-006-03-315; 09/30/22 during the COVID-19 pandemic, to continue eligibility testing and Benefit Payment Control
procedures during emergencies or other times of increased claims volume. These policies
and procedures should include strategies to pay claimants timely; Work with NASWA to
update the IDH Participant Agreement to require state to submit the results of their UI
fraud investigations;
Work with NASWA to ensure the IDH cross matches are effective at preventing the types
of fraud that were detected during the pandemic and regularly update using the results of
state fraud investigations;
Work with the OIG and states to recover the greatest practicable amount of the
$7,092,604 paid to claimants connected to likely fraudulent claims.
Alert Memorandum: ETA Needs to Obtain direct access to unemployment insurance claims data from all State Workforce
Incorporate Data Analytics Capability to Agencies; Create an integrity program that incorporates a data analytics capability and
Improve Oversight of the Unemployment regularly monitors state unemployment insurance claims data to detect and prevent
Insurance Program; improper payments, including fraudulent payments, and to identify trends and emerging
Report No. 19-23-012-03-315; 09/25/23 issues that could negatively impact the unemployment insurance program.
COVID-19: Pandemic Unemployment Work with Congressional stakeholders to inform them of the urgency of the statute of
Assistance for Non-Traditional Claimants limitations concerning pandemic-related UI fraud.
Weakened by Billions in Overpayments
Including Fraud;
Report No. 19-23-014-03-315; 09/27/23
continued on next page
140 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Worker Safety
MSHA Needs to Provide Better Oversight Clarify mine operators’ responsibilities for local coordination under the Mine Improvement
of Emergency Response Plans; and New Emergency Response (MINER) Act, including coordination and communication
Report No. 05-17-002-06-001; 03/31/17 between the operator, mine rescue teams, and local emergency response personnel, and
familiarizing local rescue personnel with surface functions that may be required in the
course of mine rescue work.
MSHA Needs to Improve Efforts to Protect Adopt a lower legal exposure limit for silica in coal mines based on recent scientific
Coal Miners from Respirable Crystalline evidence; Establish a separate standard for silica that allows MSHA to issue citations
Silica; and monetary penalty when violations of its silica exposure limit occur; Enhance its
Report No. 05-21-001-06-001; 11/12/20 sampling program to increase the frequency of inspector samples where needed (e.g., by
implementing a risk-based approach).
OSHA’s Diminished Enforcement Left Implement a policy for future emphasis programs that minimizes the lapse in enforcement
More Workers at Risk for Exposure to between canceled, revised, or new programs;
Silica; Establish meaningful goals and processes to assess whether OSHA’s outreach events are
Report No. 02-21-003-10-105; 09/29/21 achieving the desired results in reaching a targeted number of workers at risk of exposure
to silica.
COVID-19: To Protect Mission Critical Develop an OSHA outreach plan to be activated during a large-scale safety and health crises
Workers, OSHA Could Leverage such as the COVID-19 pandemic that (a) identifies external federal agencies with enforcement
Inspection Collaboration Opportunities or oversight personnel who are active on worksites and (b) defines how OSHA will collaborate
with External Federal Agencies; Report with those agencies. OSHA should consider incorporating into the plan: a process to identify
No. 19-22-003-10-105; 03/31/22 and document highly visible safety and health hazards for large-scale safety and health crises;
a plan for how OSHA will conduct related outreach and training on those hazards and how
to refer them to OSHA; and a tracking system for agency referrals and outcomes of those
referrals, using that information to periodically inform the outreach plan on areas and types of
guidance and training the agencies’ oversight and enforcement personnel need;
Explore mechanisms to enhance collaboration, such as memorandums of understanding or
other written agreements using GAO’s seven key features for collaboration, and incorporate a
process to utilize those mechanisms into the outreach plan.
COVID-19: OSHA’S Enforcement As part of OSHA’s rulemaking on infectious diseases, require employers to notify all
Activities Did Not Sufficiently Protect employees of all known positive cases of infectious diseases at the worksite;
Workers from Pandemic Health Hazards; Develop and implement a tracking tool to ensure OSHA receives and reviews all items
Report No. 19-23-001-10-105; 10/31/22 CSHOs request during inspections to ensure alleged hazards have been mitigated.
OSHA Needs to Better Address Modify the Field Operations Manual to include a policy for mandatory interviews of
Complaints and Referrals for Increased complainants and witnesses or document the rationale for lack thereof and provide
Worker Safety; training to Compliance Safety and Health Officers on the updated requirements.
Report No. 02-23-001-10-105; 03/06/23
COVID-19: OSHA Needs to do More to Develop specific, measurable inspection goals for the Site-Specific Targeting program,
Address High Injury Rates of Warehouse including a baseline for the number of inspections in each Site-Specific Targeting
Workers; Report No. 19-23-013-10-105; category, and periodically monitor progress toward those goals; Develop a more effective
09/27/23 enforcement strategy to improve employer Form 300A compliance; Assess Form 300A
data categories and gather more specific supporting information about injuries to better
identify the count and type of injuries reported, such as musculoskeletal disorders;
Develop specific measurable inspection goals for the warehousing National Emphasis
Program, including a baseline for the number of inspections to complete and periodically
monitor progress toward those goals. Ensure the goals contain metrics that demonstrate
the outcomes of the program.
continued on next page
Semiannual Report to Congress | April 1, 2023–September 30, 2023 141
Appendices
Employment and Training Programs
ETA Did Not Sufficiently Plan and Improve funding opportunity announcements for discretionary grant programs by:
Execute the American Apprenticeship evaluating program goals using the SMART concept or a similar approach, and including
Initiative Grant Program; required metrics that directly measure the success of each program goal, are clear,
Report No. 05-21-004-03-375; 09/30/21 and are easily verifiable; having a scoring element covering completeness of applicant
proposals for items requested in the announcement that reduces in points when the
proposal is missing an element(s), significantly changes the wording of an element(s), or
incorrectly addresses an element(s); and identifying targeted occupations in the Funding
Opportunity Announcement language and/or scoring elements, or requiring submission
of the career pathway to an H-1B occupation as support during apprenticeship program
registrations or apprentice registrations.
Employee Benefits
EBSA Did Not Have the Ability to Reduce or eliminate exemption thresholds for small plans.
Protect the Estimated 79 Million Plan
Participants in Self Insured Health Plans
from Improper Denials of Health Claims;
Report No. 05-17-001-12-121; 11/18/16
OWCP Did Not Ensure Best Prices and Implement a process to ensure competitive prices for the FECA program by regularly
Allowed Inappropriate, Potentially Lethal evaluating alternate pricing methodologies and other sources—including publicly
Prescriptions in the FECA Program; available benchmark price lists, state fee schedules, market research, and comparable
Report No. 03-23-001-04-431; 3/31/23 payers—and updating its pricing methodology as appropriate;
Implement a process to review the effectiveness of policy changes, including:
(a) documented assessment of prescription information after any changes in the
authorization, approval, and/or adjudication process; and (b) documented solutions for
any performance gaps identified during the review, including follow-up testing; Implement
an ongoing pharmaceutical monitoring and alert program to identify and closely monitor
significant changes in costs, prescribing patterns, utilization, sources, and new and novel
prescription drugs;
Establish internal controls that identify prescription drugs payment and management
issues in near-real-time;
Implement a technology solution to perform ongoing prescription-claim-level reviews in
near real-time;
Develop and deliver ongoing formal training for staff involved in making pharmaceutical
decisions.
continued on next page
142 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Departmental Management
FISMA Fiscal Year 2015: Ongoing Realign the organizational structure as it relates to the Chief Information Officer to
Security Deficiencies Exist; address organizational independence issues.
Report No. 23-16-002-07-725; 09/30/16
FY 2019 FISMA DOL Information Implement improvements in DOL’s information security program for the following areas:
Security Report: Implementation of Configuration Management, and Access Management, Data Protection and Privacy.
Security Tools Hindered by Insufficient
Planning;
Report No. 23-20-002-07-725; 12/23/19
DOL Needs to Do More to Secure Establish and implement procedures to ensure E2 Solutions (E2) account management
Employees’ Personally Identifiable practices enforce DOL’s security policies;
Information in the Travel Management Establish and implement procedures to ensure E2 is managed in compliance with
System; contractual security requirements and DOL computer security policies for contracted
Report No. 23-20-003-13-001; 09/10/20 information systems.
FY 2020 FISMA DOL Information Implement a process for approving deviations from established configuration settings.
Security Report: Progress Needed
to Improve Risk Management and
Continuous Monitoring Information
Security Controls;
Report No. 23-21-001-07-725; 12/22/20
DOL’s IT Governance Lacked the Reorganize the Chief Information Officer position to have a direct reporting relationship to
Framework Necessary to Support the the Deputy Secretary and independent of ASAM;
Overall Mission Report; Ensure the Chief Information Officer is a lead member with voting rights of DOL’s executive
Report No. 23-21-002-01-001; 09/30/21 strategy and management boards and committees including but not limited to the
Management Review Board, Enterprise Shared Services Governance Board, COVID-19
Coordination team, and Enterprise Risk Management Council; Establish an MOU or
other agreement between the Office of the Chief Information Officer and all departmental
agencies to establish and state the roles and responsibilities of IT between each set of
respective agencies; Reassess the incorporation of BLS and OCFO as part of IT Shared
Services within 2021, and document the reasoning for the decision reached;
Codify the policies and procedures that define IT governance and key supporting IT
elements.
FY 2022 Independent Auditors’ Report Design and implement controls over their respective estimates to ensure management’s
on DOL’s CFS; review of the estimates are performed at a sufficient level of detail, including the
Report No. 22-23-002-13-001; 12/13/22 methodology, underlying data, and assumptions used to develop the estimates;
Maintain documentation of the reviews performed to assess the reasonableness of the
methodology, underlying data, and assumptions used to develop the estimates that is
sufficiently detailed to evidence the specific items reviewed, analysis performed, and
conclusions reached;
Provide additional training to the reviewers of the estimates to reinforce established
policies and procedures, as necessary.
FY 2022 FISMA DOL Information Update DOL entity-wide and system-level security policies, procedures, and plans to
Security Report: DOL’s Information comply with NIST SP 800-53, Rev. 5;
Security Program Not Remaining Current Implement proper quality control to ensure change management processes are being
with Security Requirements; performed for all systems and equipment on the DOL network;
Report No. 23-23-001-07-725; 02/10/23 Implement data loss prevention tools and alerts based on the results of agencies’ data
exfiltration tests; Verify if systems have been appropriately authorized in accordance with
DOL’s policy.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 143
Appendices
Summary of Reports with Unimplemented
Recommendations with Cost Savings / Funds
Put to Better Use
Funds Put to Better
Number of
Report Title; Report Number; Date Issued Unimplemented
Recommendations Use ($)
Employment and Training Administration
Alert Memorandum: The Employment and Training Administration (ETA) Needs to Ensure State
Workforce Agencies (SWA) Implement Effective Unemployment Insurance Program Fraud Controls for
High Risk Areas; Report No. 19-21-002-03-315; 02/22/21
Establish effective controls, in collaboration with SWAs, to mitigate fraud and other improper payments 1 $5,409,966,198
to ineligible claimants, including the areas identified in the memorandum: UI benefits paid to multistate
claimants, claimants who used the Social Security numbers of deceased individuals, potentially
ineligible federal inmates, and claimants with suspicious email accounts. Effective controls will help
prevent similar or greater amounts of fraud and allow those funds to be put to better use.
COVID-19: States Struggled to Implement CARES Act Unemployment Insurance Programs;
Report No. 19-21-004-03-315; 05/28/21
1 $33,745,677,576
Continue to work with states to develop, operate, and maintain a modular set of technological
capabilities to modernize the delivery of UI benefits that is sufficient to manage and process sudden
spikes in claims volume during emergencies or high unemployment.
ETA Did Not Sufficiently Plan and Execute the American Apprenticeship Initiative Grant Program;
Report No. 05-21-004-03-375; 09/30/21
Improve funding opportunity announcements for discretionary grant programs by conducting the
following: Evaluate program goals using the SMART concept or a similar approach, and include
required metrics that directly measure the success of each program goal, are clear, and are
1 $155,582,864
easily verifiable; have a scoring element covering completeness of applicant proposals for items
requested in the announcement that reduces in points when the proposal is missing an element(s),
significantly changes the wording of an element(s), or incorrectly addresses an element(s);
and identify targeted occupations in the FOA language and/or scoring elements, or require
submission of the career pathway to an H-1B occupation as support during apprenticeship program
registrations or apprentice registrations
Alert Memorandum: Potentially Fraudulent Unemployment Insurance Payments in High-Risk Areas
Increased to $45.6 Billion;Report No. 19-22-005-03-315; 09/21/22
Expedite OIG-related amendments to 20 C.F.R. § 603.6(a) to make ongoing disclosures of UI
1 $29,581,490,253
information to DOL OIG mandatory by expressly adding the U.S. Department of Labor, Office of
Inspector General (including its agents and contractors) to the list of required disclosures that are
necessary for the proper oversight of the UI program without distinction as to purpose (e.g., audits
versus investigations).
Total 4 $68,892,716,891
144 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Reports with Unimplemented
Recommendations for Management
Improvement or Disallowed Costs Owed
The following table lists all OIG reports issued prior to this semiannual reporting period with
recommendations that have not yet been fully implemented (as of September 30, 2023). For identification
of each recommendation made before September 30, 2023, visit our online Recommendation Dashboard.
Number of
Disallowed Costs
Report Title; Report Number; Date Issued Unimplemented
Owed
Recommendations
Employee Benefits Security Administration
Limited-Scope Audits Provide Inadequate Protections to Retirement Plan Participants;
1 $0
Report No. 05-14-005-12-121; 09/30/14
EBSA Did Not Have the Ability to Protect the Estimated 79 Million Plan Participants in Self-Insured
Health Plans from Improper Denials of Health Claims; 1 $0
Report No. 05-17-001-12-121; 11/18/16
Employment and Training Administration
Investigative Advisory Report – Weaknesses Contributing to Fraud in the Unemployment
2 $0
Insurance Program; Report No. 50-15-001-03-315; 07/24/15
ETA Violated the Bona Fide Needs Rule and the Antideficiency Act;
1 $0
Report No. 26-17-002-03-370; 09/21/17
Job Corps Should Do More to Prevent Cheating in High School Programs;
2 $0
Report No. 26-19-001-03-370; 09/25/19
COVID-19: More Can Be Done to Mitigate Risk to Unemployment Compensation Under the
2 $0
CARES Act; Report No. 19-20-008-03-315; 08/07/20
Alert Memorandum: The Employment and Training Administration (ETA) Needs to Ensure State
Workforce Agencies (SWA) Implement Effective Unemployment Insurance Program Fraud 1 $0
Controls for High Risk Areas; Report No. 19-21-002-03-315; 02/22/21
COVID-19: States Struggled to Implement CARES Act Unemployment Insurance Programs;
2 $0
Report No. 19-21-004-03-315; 05/28/21
continued on next page
Semiannual Report to Congress | April 1, 2023–September 30, 2023 145
Appendices
Alert Memorandum: The Employment and Training Administration Needs to Issue Guidance to
Ensure State Workforce Agencies Provide Requested Unemployment Insurance Data to the Office 3 $0
of Inspector General; Report No. 19-21-005-03-315; 06/16/21
Alert Memorandum: The Employment and Training Administration Does Not Require the National
Association of State Workforce Agencies to Report Suspected Unemployment Insurance Fraud
2 $0
Data to the Office of Inspector General or the Employment and Training Administration; Report No.
19-21-006-03-315; 07/01/21
Unemployment Insurance Overpayments Related to Work Search Underscore the Need for More
3 $0
Consistent State Requirements; Report No. 04-21-001-03-315; 09/29/21
ETA Did Not Sufficiently Plan and Execute the American Apprenticeship Initiative Grant Program;
4 $0
Report No. 05-21-004-03-375; 09/30/21
COVID-19: Safety and Remote Learning Challenges Continue for Job Corps;
3 $0
Report No. 19-22-001-03-370; 11/12/21
COVID-19: Delays in Providing Disaster Relief Jeopardize $366 Million Disaster Worker Grant
1 $0
Program; Report No. 19-22-002-03-391; 01/28/22
Alert Memorandum: The ETA Needs to Ensure SWAs Report Activities Related to CARES Act UI
2 $0
Programs; Report No. 19-22-004-03-315; 08/02/22
Alert Memorandum: Potentially Fraudulent Unemployment Insurance Payments in High-Risk
2 $0
Areas Increased to $45.6 Billion; Report No. 19-22-005-03-315; 09/21/22
COVID-19: ETA and States Did Not Protect Pandemic Related UI Funds from Improper Payments
5 $0
Including Fraud or From Payment Delays; Report No. 19-22-006-03-315; 09/30/22
Quality Control Review: Single Audit of AARP Foundation for the year ended December 31, 2021;
2 $0
Report No. 24-22-004-50-598; 09/30/22157
Quality Control Review of the Single Audit of the State of New Mexico Workforce Solutions
2 $0
Department for the Year Ended June 30, 2021; Report No. 24-23-001-50-598; 03/07/23
Mine Safety and Health Administration
MSHA Needs to Provide Better Oversight of Emergency Response Plans;
6 $0
Report No. 05-17-002-06-001; 03/31/17
MSHA Did Not Evaluate Whether Civil Monetary Penalties Effectively Deterred Unsafe Mine
2 $0
Operations; Report No. 23-19-002-06-001; 08/16/19
MSHA Can Improve its Pre-Assessment Conferencing Program; Report No. 05-19-001-06-001;
9 $0
09/23/19
MSHA Needs to Improve Efforts to Protect Coal Miners from Respirable Crystalline Silica;
3 $0
Report No. 05-21-001-06-001; 11/12/20
MSHA Can Improve How Violations Are Issued, Terminated, Modified, and Vacated;
9 $0
Report No. 05-21-002-06-001; 03/31/21
continued on next page
157 The QCR Single Audit Report recommendations are addressed to the accounting firm; however, ETA funds the
grant and are copied during report issuance, hence the addition to the ETA section of the table. The accounting firm
will address the recommendations.
146 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Office of the Assistant Secretary for Administration and Management
Ineffective Accounting for Sensitive Information Technology Hardware and Software Assets Places
6 $0
DOL at Significant Risk; Report No. 23-11-001-07-001; 03/31/11
FISMA Fiscal Year 2015: Ongoing Security Deficiencies Exist; Report No. 23-16-002-07-725;
1 $0
09/30/16
Alert Memorandum: Security Vulnerability Relating to DOL Information Security Property;
2 $0
Report No. 50-19-002-07-725; 06/17/19
FY 2019 FISMA DOL Information Security Report: Implementation of Security Tools Hindered by
5 $0
Insufficient Planning; Report No. 23-20-002-07-725; 12/23/19
FY 2020 FISMA DOL Information Security Report: Progress Needed to Improve Risk Management
2 $0
and Continuous Monitoring Information Security Controls; Report No. 23-21-001-07-725; 12/22/20
FY 2021 FISMA DOL Information Security Report: Information Security Continuous Monitoring
5 $0
Controls Remain Deficient; Report No. 23-22-001-07-725; 01/28/22
FY 2022 DOL Made Progress in Implementing Geospatial Data Act Requirements, But More
3 $0
Needs to Be Done; Report No. 23-22-003-01-001; 09/30/22
FY 2022 FISMA DOL Information Security Report: DOL’s Information Security Program Not
3 $0
Remaining Current with Security Requirements; Report No. 23-23-001-07-725; 02/10/23
Office of the Chief Financial Officer
Management Advisory Comments Identified in an Audit of the Consolidated Financial Statements
2 $0
for the Year Ended September 30, 2019; Report No. 22-20-005-13-001; 12/19/19
DOL Needs to Do More to Secure Employees’ Personally Identifiable Information in the Travel
2 $0
Management System; Report No. 23-20-003-13-001; 09/10/20
Management Advisory Comments Identified in an Audit of the Consolidated Financial Statements
3 $0
for the Year Ended September 30, 2020; Report No. 22-21-005-13-001; 12/18/20
FY 2022 Independent Auditors' Report on DOL's Consolidated Financial Statement for the Year
3 $0
Ended September 30, 2021; Report No. 22-23-002-13-001; 12/13/22
Management Advisory Comments Identified in an Audit of the Consolidated Financial Statements,
8 $0
For the Year Ended September 30, 2022; Report No. 22-23-005-13-001; 01/30/23
Office of Federal Contract Compliance Programs
OFCCP Did Not Show It Adequately Enforced EEO Requirements on Federal Construction
1 $0
Contracts; Report No. 04-20-001-14-001; 03/27/20
continued on next page
Semiannual Report to Congress | April 1, 2023–September 30, 2023 147
Appendices
Office of the Secretary
DOL’s IT Governance Lacked the Framework Necessary to Support the Overall Mission;
5 $0
Report No. 23-21-002-01-001; 09/30/21
Occupational Safety and Health Administration
OSHA Needs to Improve the Guidance for Its Fatality and Severe Injury Reporting Program to
1 $0
Better Protect Workers; Report No. 02-18-203-10-105; 09/13/18
OSHA Procedures for Issuing Guidance Were Not Adequate and Mostly Not Followed;
4 $0
Report No. 02-19-001-10-105; 03/28/19
Review of the Occupational Safety and Health Administration’s Referral to and Reclamation of
1 $0
Debt from the U.S. Department of the Treasury; Report No. 22-20-006-10-001; 03/16/20
COVID-19: Increased Worksite Complaints and Reduced OSHA Inspections Leave U.S. Workers’
1 $0
Safety at Increased Risk; Report No. 19-21-003-10-105; 02/25/21
OSHA’s Diminished Enforcement Left More Workers at Risk for Exposure to Silica;
2 $0
Report No. 02-21-003-10-105; 09/29/21
COVID-19: To Protect Mission Critical Workers, OSHA Could Leverage Inspection Collaboration
2 $0
Opportunities with External Federal Agencies; Report No. 19-22-003-10-105; 03/31/22
COVID-19: OSHA’s Enforcement Activities Did Not Sufficiently Protect Workers from Pandemic
5 $0
Health Hazards; Report No. 19-23-001-10-105; 10/31/22
OSHA Needs to Better Address Complaints and Referrals for Increased Worker Safety;
3 $0
Report No. 02-23-001-10-105; 03/06/23
Office of Workers’ Compensation Programs
District of Columbia Workmen’s Compensation Act Special Fund Financial Statements and
Independent Auditors’ Report September 30, 2021 and 2020; 2 $0
Report No. 22-23-005-13-001; 02/22/23
OWCP Did Not Ensure Best Prices and Allowed Inappropriate, Potentially Lethal Prescriptions in
10 $321,261,486
the FECA Program; Report No. 03-23-001-04-431; 03/31/23
Wage and Hour Division
COVID-19: The Pandemic Highlighted the Need to Strengthen Wage and Hour Division’s
4 $0
Enforcement Controls; Report No. 19-21-008-15-001; 09/30/21
Totals 156 $321,261,486
148 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Investigative Statistics
Division
Total
Totals
Investigative Reports Issued / Cases Closed (includes investigative reports issued, case closing
212
reports, and matters referred for possible civil and/or administrative action):
Program Fraud 198
Labor Racketeering 14
Cases Opened: 197
Program Fraud 189
Labor Racketeering 8
Cases Referred for Prosecution (each case is measured as a singular statistic and may include more
139
than one person or business entity):
Program Fraud 132
Labor Racketeering 7
Cases Referred for Administrative/Civil Action (each case is measured as a singular statistic and
112
may include more than one person or business entity):
Program Fraud 109
Labor Racketeering 3
Persons Referred to the Department of Justice for Criminal Prosecution (includes the number of
171
individuals and business entities referred for prosecution):
Program Fraud 164
Labor Racketeering 7
Persons Referred to State and Local Prosecuting Authorities for Criminal Prosecution (includes
18
the number of individuals and business entities referred for prosecution):
Program Fraud 18
Labor Racketeering 0
Indictments and Criminal Informations That Resulted from Any Prior Referral to Prosecuting
247
Authorities (includes sealed and unsealed indictments):
Program Fraud 240
Labor Racketeering 7
Indictments (includes sealed and unsealed indictments): 247
Program Fraud 240
Labor Racketeering 7
Convictions: 236
Program Fraud 221
Labor Racketeering 15
Statutory Debarments: 3
Program Fraud 3
Labor Racketeering 0
continued on next page
Semiannual Report to Congress | April 1, 2023–September 30, 2023 149
Appendices
Recoveries, Cost-Efficiencies, Restitutions, Fines/Penalties, Forfeitures, and Civil
$133,484,818
Monetary Actions:
Program Fraud $127,784,754
Labor Racketeering $5,700,064
Recoveries (the dollar amount/value of an agency’s action to recover or to reprogram
$15,439,387
funds or to make other adjustments in response to OIG investigations):
Cost-Efficiencies (the one-time or per annum dollar amount/value of management’s
commitment, in response to OIG investigations, to utilize the government’s resources $1,162,910
more efficiently):
Restitutions/Forfeitures (the dollar amount/value of restitutions and forfeitures
$89,674,520
resulting from OIG criminal investigations):
Fines/Penalties (the dollar amount/value of fines, assessments, seizures, investigative/
$210,696
court costs, and other penalties resulting from OIG criminal investigations):
Civil Monetary Actions (the dollar amount/value of forfeitures, settlements, damages,
$26,997,304
judgments, court costs, and other penalties resulting from OIG criminal investigations):
Total $133,484,818158
158 The OIG assisted in the identification and recovery of more than $74 million in unemployment insurance benefits
that were not directly related to an open OIG investigation and were not previously reported or included in the
statistics above.
150 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Appendices
Peer Review Reporting
The following meets the requirement under Section 5(1)(14)(A)–(B) of the Inspector General Act of
1978, as amended, and Section 989C of the Dodd–Frank Wall Street Reform and Consumer Protection
Act (P.L. 111–203) that the Inspectors General include their peer review results as an appendix to each
semiannual report.
Peer Review of DOL OIG Inspection and Evaluation Function
The Federal Housing Finance Agency OIG conducted an external peer review to assess the
extent to which the DOL OIG met seven standards in the Council of the Inspectors General on
Integrity and Efficiency’s Quality Standards for Inspection and Evaluation (Blue Book), issued
January 2012. The peer review report, issued on April 25, 2023, concluded that the DOL OIG’s
policies and procedures and the three reviewed reports were consistent with and complied with
the covered Blue Book standards for the period ended September 30, 2022.
Peer Review of DOL OIG Audit Function
The U.S. Department of Health and Human Services OIG conducted a peer review of the
system of quality control for DOL OIG’s audit function for the period ending September 2021.
The peer review report, which was issued on September 15, 2022, resulted in an opinion that
the system of quality control was suitably designed and provided reasonable assurance of DOL
OIG’s conforming to professional standards in the conduct of audits. The peer review covered
audit work performed during the unprecedented COVID-19 pandemic, and DOL OIG received a
clean report with a rating of pass with no recommendations.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 151
Appendices
OIG Hotline
The OIG Hotline provides a communication link between the OIG and persons who want to report alleged
violations of laws, rules, and regulations; mismanagement; waste of funds; abuse of authority; or danger
to public health and safety. During the reporting period April 1, 2023, through September 30, 2023, a total
of 6,029 complaints were opened in the OIG Hotline’s complaint management system. The majority of
these complaints involve concerns regarding COVID-19-related unemployment benefits. Since the start
of the pandemic, the OIG’s Office of Investigations referred 29,622 complaints to the appropriate State
Workforce Agency for further review and/or action in response to complaints regarding alleged fraud
involving COVID-19-related unemployment benefits. During this reporting period, the OIG Hotline received
additional complaints that are awaiting processing.
*The total number of complaints referred during this reporting period exceeds the number of complaints
received as the OIG Hotline is continuing to analyze and process a backload of complaints regarding
alleged fraud involving COVID-19-related unemployment benefits.
Complaints Received (by method reported) Totals
Telephone 22
E-mail/Internet 5,925
Mail 82
Fax 0
Walk-In 0
Total 6,029
Contacts Received (by source) Totals
Complaints from Individuals or Non-Governmental Organizations 1,757
Complaints/Inquiries from Congress 5
Referrals from GAO 18
Complaints from Other DOL Agencies 11
Complaints from Other (non-DOL) Government Agencies 4,238
Total 6,029
Disposition of Complaints Totals
Referred to OIG Components for Further Review and/or Action 108
Referred to DOL Program Management for Further Review and/or Action 164
Referred to Non-DOL Agencies/Organizations 34
No Referral Required/Informational Contact 763
Total* 1,069
152 Semiannual Report to Congress | April 1, 2023–September 30, 2023
OIG FY 2024 Audit Workplan
Fiscal Year 2024 Audit Workplan
BENEFITS REVIEW BOARD (BRB)
Discretionary Audit
1. BRB Backlog of Black Lung and Longshore and Harbor Worker Claims – New. The BRB
decides appeals from the Office of Administrative Law Judges (OALJ) under the Black Lung
Benefits Act, the Longshore and Harbor Workers’ Compensation Act, and the Longshore and
Harbor Workers’ Compensation Act extensions, including the Defense Base Act (DBA). In FY
2020 and FY 2021, there was a large influx of DBA cases, which the Department predicts will
continue in FY 2022 and FY 2023. According to Department officials, this influx of DBA cases
is the most important new challenge for the OALJ and BRB. In addition, OALJ expects to
increase production with additional budget and full-time employees. In FY 2022, the BRB had a
backlog of 648 Black Lung appeal cases with an average processing time of 16.8 months and
a backlog of 97 Longshore/DBA appeal cases with an average processing time of 12.5 months.
The continued increase of Longshore/DBA appeal cases since FY 2020, along with a continued
influx of new Black Lung and Non DBA Longshore appeal cases, could impact BRB appeal case
processing times and increase BRB’s backlog of appeal cases, delaying claimants from receiving
vital benefits. This audit will focus on BRB’s efforts to expeditiously adjudicate Black Lung and
Longshore (DBA and Non DBA) appeals and reduce the backlog of appeal cases.
EMPLOYEE BENEFITS SECURITY ADMINISTRATION (EBSA)
Discretionary Audits
2. EBSA’s Mental Health Parity Compliance Efforts – New. In 2008, Congress passed the
Mental Health Parity and Addiction Equity Act to ensure that financial requirements and
treatment limitations applicable to mental health and substance use disorder benefits under
group health plans and health insurance coverage are not more restrictive than those applicable
to medical/surgical benefits. In the Consolidated Appropriations Act of 2021, Congress amended
the Mental Health Parity and Addiction Equity Act to require group health plan and health
insurance issuers to perform and document comparative analyses to ensure compliance with
its requirements. Many group health plan and health insurance issuers are not complying with
existing requirements, which are enforced by EBSA for approximately 134.2 million workers and
their families for all employer-sponsored health insurance. This audit will focus on assessing the
extent of EBSA’s enforcement of mental health parity laws and regulations.
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3. EBSA’s Oversight of Limited-Scope Audits – New. The Employee Retirement Income
Security Act of 1974 generally requires every employee benefit plan with more than 100
participants to obtain an audit of the plan's financial statements each year. However, an
exemption in the law allows auditors to perform “limited-scope audits.” Such audits exclude
pension plan assets already certified by certain banks or insurance carriers and provide little
to no confirmation regarding the actual existence or value of the assets. In 2013 and 2014,
we reported159 that as much as $3 trillion in pension assets, including assets in hard-to-value
alternative investments, received limited-scope audits. In 2019, the American Institute of Certified
Public Accountants updated its accounting standards related to these types of audits. The new
standards replaced limited-scope audits with audits from Section 103(a)(3)(C) of the act and
imposed new performance requirements on plan management and auditors. This audit will follow
up on our prior work and update how the changes in accounting standards and any actions
taken by EBSA since then have impacted EBSA’s oversight of benefit plan assets covered by
Employee Retirement Income Security Act of 1974 Section 103(a)(3)(C) audits.
EMPLOYMENT AND TRAINING ADMINISTRATION (ETA)
Mandatory Audits
Job Corps
4. Job Corps Firm-Fixed Price Contract Transition – New. In 2019, Job Corps began to
transition its center operations contracts from cost-reimbursement to firm-fixed-price. As of
March 2023, Job Corps had transitioned over 60 center operations contracts and expected
to complete this transition in 2024. While firm fixed-price contracting allows for greater cost
predictability, costs are generally higher because contractors need to mitigate the risks of rising
prices and cost overruns. At the same time, firm-fixed-price contracting requires an increased
focus on monitoring and oversight to ensure center operators do not cut costs by reducing the
quantity or quality of services provided to Job Corps students. This audit will focus on Job Corps’
strategy for awarding and monitoring firm fixed-price contracts and the effect of this transition on
students and program performance.
159 EBSA Needs to Provide Additional Guidance and Oversight to ERISA Plans Holding Hard-to-Value Alternative
Investments, Report No. 09-13-001-12-121 (September 30, 2013)
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5. Job Corps Minor Students – In Progress. Job Corps’ students are ages 16 to 24 upon entry
into the program. The significant age range poses numerous challenges. Given the occurrence
of sexual assaults and harassment on center campuses, there is an inherent risk with having
adults up to 27 years of age cohabitate with minors as young as 16 years old. Some Job Corps
minors may (1) have been encouraged to enroll by their parents or guardians, (2) not be in
the program of their own volition, (3) not take the program seriously, and (4) disrupt program
instruction, which impacts the learning of other students. Furthermore, minor students may not
meet minimum age requirements for certain trades, affecting their ability to obtain employment
in certain fields, such as plumbing and electrical trades, possibly leading to lower program
outcomes and not meeting the intent of the Job Corps program. This audit will focus on whether
Job Corps took appropriate measures to mitigate program disruptions and ensure the safety of
and meet the program’s intent for its minor students.
Discretionary Audits
ETA Contract and Grant Programs
6. COVID-19: Assessment of ETA Job Training Programs Results – New. In March 2020,
the COVID-19 pandemic caused many of ETA’s job training programs to cease operation. This
interrupted participants’ job training, potentially preventing them from completing their training
and getting a job in the areas in which they were trained. During our pandemic oversight work,
we reported numerous issues with ETA’s management of federal grant funds. This assessment
of the OIG’s series of COVID-19: ETA Grantee Sub-Recipient audits will summarize the
overall effectiveness of ETA job training programs during the pandemic and evaluate ETA’s
implementation of lessons learned in preparation for future states of emergency.
7. ETA Registered Apprenticeship Program – New. In February 2021, President Biden expanded
the Registered Apprenticeship Program to support nearly 1 million apprenticeship opportunities
and focus the program on increasing access for underrepresented groups. Congress invested
a total of $520 million into the program in FY 2022 and 2023. However, a prior OIG audit of the
American Apprenticeship Initiative Grant Program found systematic weaknesses in the execution
of the grants, as well as the planning and awarding processes. This audit will assess the
effectiveness of ETA’s administration of the Registered Apprenticeship Program.
8. COVID-19: ETA Grantee Sub-Recipient – In Progress. In March 2020, the COVID-19
pandemic caused many of ETA’s job training programs to cease operation. This interrupted
participants’ job training, potentially preventing them from completing their training and getting a
job in the areas in which they were trained. This series of audits will focus on how effectively ETA
ensured workforce development grant funds were used as intended in selected states.
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9. ETA’s Administration of Disaster Dislocated Worker Grants – In Progress. Public Law
116–20 provided ETA with an additional $50 million for the dislocated workers assistance
national reserve for necessary expenses directly related to the consequences of Hurricanes
Florence and Michael, Typhoon Mangkhut, Super Typhoon Yutu, wildfires, and earthquakes
that occurred in calendar year (CY) 2018, and tornadoes and floods that occurred in CY 2019.
Dislocated Worker Grants (DWG) provide resources to states and other eligible applicants to
respond to large, unexpected layoff events causing significant job losses. Additionally, disaster
DWGs provide funding to create temporary employment opportunities to assist with clean-up and
recovery efforts, and employment and training services to eligible grant participants. A prior OIG
DWG report found ETA provided minimal oversight of its state grantees and needs to do more to
ensure grantees help local areas to restore communities timely; ensure out of work participants
receive expeditious disaster relief assistance; maximize the number of participants who obtain
employment as intended by the grants; and ensure disaster relief funds are used efficiently and
effectively. This audit will focus on the extent ETA properly administered the DWG program to
provide assistance in the aftermath of the 2018 and 2019 disasters.
Foreign Labor Certification
10. Backlog of H-2B Temporary Non-agricultural Program Visa Applications – New. In 2018,
the OIG issued a report that found ETA’s lack of key controls over the processing of H-2B visa
applications had negatively impacted businesses that depended on H-2B workers. ETA could
not demonstrate it’s processing of applications provided enough time for the U.S. Department
of Homeland Security and the U.S. Department of State to perform their functions and enable
employers to hire H 2B workers within the timeframe required. Any delays, particularly for
seasonal industries, would have serious adverse effects on business owners and local
economies. Further, in 2020, we reported that ETA’s processing of H-2B applications continued
to be an area of concern, causing backlogs and impacting dependent businesses. This audit
will focus on ETA’s processing of H 2B applications, specifically the timeliness of processing
prevailing wage determinations and whether improvements to the review process have reduced
the application backlog.
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11. Effectiveness of ETA’s Permanent Labor Certification Program (PERM) Application
Processing Time – New. The PERM program allows employers to hire foreign workers when
(1) there are not sufficient U.S. workers able, willing, qualified, and available to accept the job
opportunity in the area of intended employment; and (2) the employment of foreign workers will
not adversely affect the wages and working conditions of similarly employed U.S. workers. When
submitting a PERM application, the employer is required to execute recruiting efforts for U.S.
workers within 6 months of filing an application. Based on August 2022 data, once the employer
submits the application to ETA, the average processing time to receive an approved application
from DOL is between 8 and 11 months, depending on ETA’s review process. Due to the lengthy
average processing time for applications, there is little assurance by the time a foreign worker
is approved for permanent resident status that a U.S. worker was still not available and able
to perform the same job. This audit will focus on ETA’s PERM application review process and
effectiveness in ensuring U.S. workers were still not available and able to perform the job.
12. Effectiveness of ETA’s Approval of H-2A Temporary Agricultural Program Visa
Applications – In Progress. The H 2A temporary agricultural program allows agricultural
employers who anticipate a shortage of domestic workers to bring nonimmigrant foreign workers
to the United States to perform agricultural labor or services of a temporary or seasonal nature.
To be able to hire H-2A workers, employers must self-attest (1) there are no sufficient able,
willing, and qualified U.S. workers available to perform the temporary and seasonal agricultural
employment, and (2) the employment of H 2A workers will not adversely affect the wages and
working conditions of similarly employed U.S. workers. This audit will focus on the effectiveness
of ETA’s approval process and comparing the self-attestations to supporting documentation.
Older Worker Program
13. Senior Community Service Employment Program’s Effectiveness – New. The Senior
Community Service Employment Program is the only federally sponsored employment and
training program targeted specifically to low-income, older individuals seeking to enter or
reenter the workforce. In FY 2021, ETA proposed eliminating the program because it has
struggled to achieve its goal of transitioning half of its participants who complete the program
into unsubsidized employment. Further, ETA noted in its FY 2021 Congressional Budget
Justification that nearly half of the program participants do not complete the program.
If the program continues to underperform, $405 million in program funding requested for
FY 2024 is at risk of not being effectively used to help older Americans achieve economic
self-sufficiency. This audit will focus on identifying program weaknesses to assist ETA in
improving the effectiveness of the Senior Community Service Employment Program in serving
older Americans find unsubsidized employment.
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Unemployment Insurance (UI) Program
14. American Rescue Plan Act (ARPA) Equity Grants – New. ARPA, as amended by the Fiscal
Responsibility Act of 2023, provided $1 billion in funding to DOL to prevent and detect fraud,
promote equitable access, ensure timely payment of benefits, and reduce backlogs. Of these
funds, DOL provided approximately $219 million in grants to improve UI claimant outreach and
customer service processes, implement strategies to reduce backlog, and improve access
for workers in communities that may historically experience barriers. These first-of-their-kind
grants, referred to as “Equity Grants,” will provide funding for states to improve public awareness
and service delivery as DOL seeks to address potential racial and ethnic disparities in the
administration and delivery of UI benefits in select states. This audit will focus on DOL’s and
states’ effectiveness in addressing the potential racial and ethnic disparities in the UI program.
15. Benefit Accuracy Measurement and Overpayment Prevention – New. ETA’s Benefit
Accuracy Measurement (BAM) system was designed to determine the accuracy of UI program
paid and denied benefit claims, as well as the root causes of improper payments. However,
the system did not consider temporary federally funded pandemic-related UI benefits, currently
estimated at $888 billion. The BAM system has calculated an improper payment rate estimate
of up to 21.52 percent within the last 2 years—for regular UI programs alone. Our prior work
indicates the rate was likely higher than 21.52 percent. This audit will assess ETA’s use of the
BAM system as a tool to measure states’ UI program performance and identify root causes to
reduce improper payments in UI programs.
16. Audit of DOL and States Oversight of UI Claimants Return to Work – New. The Coronavirus
Aid, Relief, and Economic Security (CARES) Act and its related extensions provided additional UI
benefits to claimants who lost their employment due to the COVID-19 pandemic. The Continued
Assistance to Unemployed Workers Act created by Section 2117 of the CARES Act included
requirements for states participating in CARES Act UI-related provisions to have a process for
addressing work refusals, to have a reporting method for employers, and to provide certain
notifications to individuals. This audit will focus on DOL’s and states’ compliance with return-to-work
provisions under the CARES Act.
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17. COVID-19: CARES Act Unemployment Insurance Programs Results – New. At the start
of the pandemic, we had significant concerns regarding the UI programs authorized by the
CARES Act—based on both previous OIG work regarding ETA and states’ ability to implement
the emergency response and on the high-risk nature of the programs. The early pandemic
period saw the largest increase in UI claims since the Department began tracking data in 1967,
a level far higher than state systems were designed to handle.160 During the first three of four
planned phases of our pandemic response oversight work, we focused on identifying areas for
improvement related to the implementation and administration of emergency UI programs and
impacts on operations. Over the past 3 years, our reporting has identified continuing program
weaknesses in internal controls, reporting, and program monitoring. As of February 8, 2023,
we estimated at least $191 billion in pandemic UI payments could have been paid improperly,
with a significant portion attributable to fraud. As we wrap up our pandemic response oversight
work, we remain significantly concerned about the expeditious and effective deployment of UI
benefits, especially in response to natural disasters and emergencies. Lessons learned are
key to adequate preparation, and proactively strengthening the UI program for both ordinary
circumstances and in advance of the next emergency will require DOL to focus on prevention.
This assessment will present overall program results from our oversight of DOL’s UI pandemic
response, impacts on agency operations, and lessons learned to assist DOL in improving its
unemployment programs and operations in advance of future emergencies.
18. Unemployment Insurance Information Technology Modernization – New. After the
pandemic’s emergence in early 2020, we reported on states’ struggles to implement
pandemic-related UI programs and prevent improper payments, including fraud, while processing
the drastically increased number of claims. We found that this occurred in part because states’
information technology systems were not modernized. Responding to the COVID-19 pandemic,
Congress funded $2 billion but later reduced this to $1 billion to modernize the nation’s UI
systems. The initiative, led by the Office of Unemployment Insurance Modernization, focuses on
three main goals: (1) fraud detection and prevention, (2) timely benefit delivery, and (3) promoting
equitable access. To achieve these goals, the Office of Unemployment Insurance Modernization
has provided targeted grants to states and territories, offered improved guidance, directed
assistance, and piloted tech-driven solutions. This audit will assess how well the Employment
and Training Administration and the Office of Unemployment Insurance Modernization have
upgraded state information technology systems and prepared states’ UI programs to operate
more effectively and efficiently, and to handle similar situations in the future.
160 COVID-19: States Struggled to Implement CARES Act Unemployment Insurance Programs,
Report No. 19-21-004-03-315 (May 28, 2021), available at:
https://www.oig.dol.gov/public/reports/oa/2021/19-21-004-03-315.pdf
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19. COVID-19: Audit of DOL and States’ Efforts to Detect and Recover Improper Payments –
In Progress. Under the CARES Act, ETA was required to implement large-scale changes to its
existing UI system, including establishing six new programs. The new programs were intended
to provide expanded UI benefits to workers who were suddenly jobless as a direct result of the
COVID-19 pandemic. Given the challenge of rapidly implementing new programs during a crisis,
ETA and states faced an additional hurdle of using controls, previously identified as weak and
deficient in published OIG reports and alert memorandums, to process more than 77 million
seasonally adjusted initial jobless claims and 571 million seasonally adjusted continued claims
over the course of the pandemic’s first year. According to the OIG’s conservative estimate as
of January 2, 2021, such circumstances increased the risk of UI improper payments (including
fraud, waste, and abuse) to exceed a total of $40 billion. This audit focuses on determining if
ETA ensured states had adequate controls to prevent, detect, and recover improper payments
stemming from UI benefits under the CARES Act and the Continued Assistance Act.
20. COVID-19: Audit of States’ Use of Staffing to Support Implementation of CARES Act
UI Programs – In Progress. During the COVID-19 pandemic, the unprecedented high rate
of unemployment led to challenges for states in processing UI claims, completing mandatory
reporting, and performing required overpayment detection procedures due to insufficient
staffing. DOL and states found themselves unprepared for the circumstances surrounding
COVID-19 and struggled to implement CARES Act UI programs, while unemployed workers
faced lengthy delays in receiving UI benefits. The CARES Act provided states with temporary
“emergency” flexibility through December 31, 2020, for additional staffing and to quickly process
unemployment claims, and subsequent legislation extended these CARES Act UI provisions.
This audit focuses on DOL’s efforts to ensure states’ staffing supported the implementation of UI
programs under the CARES Act and its amendments.
21. COVID-19: Short-Time Compensation (STC) Program – In Progress. Passage of the CARES
Act expanded UI program benefits to new and existing programs, including the STC program.
The CARES Act included provisions that increased the federal reimbursement to 100 percent
of benefits for states that have an STC program in their laws and provided for a 50 percent
reimbursement for states that do not have an STC program in their laws but agreed to operate a
program on a temporary basis. The STC program acts as a work share program, with employers
reducing the number of hours offered to employees, while the state makes up the difference
in the form of benefit payments. ETA provided states with an estimated $1.3 billion for benefit
reimbursements and $18.7 million administrative costs. Twenty-six states have participated in the
program. This audit will determine how states implemented the STC program for the benefit of
unemployed individuals and to meet the intent of the program.
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22. COVID-19: Mixed Earners Unemployment Compensation (MEUC) – In Progress. The MEUC
program is a new temporary federal program under the Continued Assistance Act and ARPA. It
provided additional benefits to certain self-employed individuals who are available for work for
the week ending January 2, 2021, through the week ending September 4, 2021. This audit will
determine how states implemented the MEUC program for the benefit of unemployed individuals
and to meet the intent of the program.
23. Pandemic Response Accountability Committee (PRAC) – DOL Programs – Case Study
Project (Part 2) – In Progress. The focus of this oversight project will be to identify the federal
pandemic response program funds provided to select geographic areas, identify the purpose
of those funds, and determine if the federal program spending aligned with the intended goals
and objectives. This project is under the direction of the PRAC and is being conducted in
coordination with nine other OIGs.
24. COVID-19: ETA and States’ Efforts to Address Multistate UI Claimants – In Progress. In
September 2022, we alerted DOL to over $45 billion we had identified in potential fraud paid in
four high-risk areas. Multistate claimants were the largest high-risk area. Through ETA, the OIG
provided states with our underlying methodology, as well as specific claimant information for
follow-up action. This audit will examine the extent to which ETA and states have taken action to
address potentially fraudulent CARES Act UI claims.
25. COVID-19: ETA and States’ Efforts to Address UI Claimants Filing with Social Security
Numbers of Deceased Persons – In Progress. In September 2022, we alerted DOL to over
$45 billion we had identified in potential fraud paid in four high-risk areas. One high-risk area
was UI claimants filing with Social Security numbers (SSN) of deceased persons. Through
ETA, the OIG provided states with our underlying methodology, as well as specific claimant
information for follow-up action. This audit will examine the extent to which ETA and states
have taken action to address potentially fraudulent CARES Act UI claims filed with SSNs of
deceased persons.
26. COVID-19: ETA and States’ Efforts to Address UI Claimants Filing with Social Security
Numbers of Federal Prisoners – In Progress. In September 2022, we alerted DOL to over
$45 billion we had identified in potential fraud paid in four high-risk areas. One high-risk area
was UI claimants filing with SSNs of federal prisoners. Through ETA, the OIG provided states
with our underlying methodology, as well as specific claimant information for follow-up action.
This audit will examine the extent to which ETA and states have taken action to address
potentially fraudulent CARES Act UI claims filed with SSNs of federal prisoners.
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27. COVID-19: ETA and States’ Efforts to Address UI Claimants Filing with Suspicious Email
Accounts – In Progress. In September 2022, we alerted DOL to over $45 billion we had
identified in potential fraud paid in four high-risk areas. One high-risk area was UI claimants
filing with suspicious email accounts. Through ETA, the OIG provided states with our underlying
methodology as well as specific claimant information for follow-up action. This audit will examine
the extent to which ETA and states have taken action to address potentially fraudulent CARES
Act UI claims filed with suspicious email accounts.
28. COVID-19: Impact of Waivers on UI Overpayments, Fraud Investigations, and Recoveries –
In Progress. On February 7, 2022, DOL issued Unemployment Insurance Program Letter (UIPL)
20-21, Change 1, regarding states’ ability to waive the recovery of certain UI overpayments under
the CARES Act program. There are concerns these waivers could adversely impact the pursuit
of fraud in the UI program. Also, the waivers could potentially allow for fraudulent CARES Act UI
payments to go uncollected. This audit will determine the impact of waivers on UI overpayments,
fraud investigations, and recoveries.
29. DOL-SBA COVID-19 Joint Project: Opportunities to Share Data to Prevent and Mitigate
Fraudulent UI and Economic Injury Disaster Loan Payments – In Progress. The Small
Business Administration (SBA) OIG and DOL OIG have reported billions in potential fraudulent
UI and Economic Injury Disaster Loan payments during the COVID-19 pandemic. In reviewing
how to be better prepared for the next national emergency, the DOL OIG is collaborating with the
SBA OIG on a joint review to determine if collaboration, including data sharing between ETA and
SBA, could prevent or mitigate the risk of future fraudulent UI and Economic Injury Disaster Loan
payments or disbursements.
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MINE SAFETY AND HEALTH ADMINISTRATION (MSHA)
Discretionary Audits
30. MSHA Grant Programs – New. MSHA is responsible for administering two types of annual
grant programs. The state grant program distributes formula grants to state agency programs
in 49 states and the Navajo Nation to support health and safety training and reduce mining
accidents, injuries, and illness. The Brookwood-Sago Mine Safety Grants Program, established
by the Mine Improvement and New Emergency Response (MINER) Act of 2006, distributes
discretionary grants to develop education and training programs to better identify, avoid, and
prevent unsafe working conditions in and around mines. The 2023 program announcements
for these two programs included funding levels of $10.5 million (estimated 56 grantees) and
$1 million (up to 20 grantees), respectively. MSHA designs the goals of each grant program
based on changing training priorities. Grantees report funding and performance data quarterly
to MSHA, which factor into MSHA’s grantee monitoring and evaluation of program success.
Without sufficient internal controls, reliability of the grantee reported data may be compromised
and could result in deteriorated program oversight or performance. This audit will assess whether
MSHA properly designed and executed the grant programs and included sufficient internal
controls within its grantee reporting system(s) to help ensure programmatic success.
31. Mine Rescue Response Plan – New. When disaster strikes, a well-prepared mine rescue
effort can mean the difference between life and death for trapped miners. Insufficient personnel,
equipment, or training could hamper MSHA’s ability to respond quickly and effectively in mine
rescue situations. Prior OIG work found MSHA had not provided adequate oversight of mine
emergency response plans, which included planning by both mine operators and MSHA. This
audit will assess MSHA’s preparedness in responding to emergencies requiring mine rescue
operations.
32. COVID-19: Impact on Miner Training – In Progress. There were 39 mining fatalities in 2021,
which is the highest total since 2014. Many fatalities can be prevented by properly training
miners and applying industry best practices. There are training requirements for both new and
experienced miners. However, the COVID-19 pandemic has impacted the way miner training is
provided. During a December 2021 MSHA stakeholder call, a participant expressed concern that
entirely virtual training during the pandemic did not meet regulatory requirements. The risk for
accidents and fatalities increases when miners are improperly trained. This audit will look at how
the COVID-19 pandemic affected miner training.
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OFFICE OF FEDERAL CONTRACT COMPLIANCE PROGRAMS (OFCCP)
Discretionary Audits
33. OFCCP’s Enforcement of Equal Employment Opportunity Obligations – New. OFCCP
is charged with protecting America's workers by enforcing equal employment opportunity and
affirmative action obligations of employers that conduct business with the federal government
as contractors. OFCCP focuses on identifying patterns of systemic discrimination in employer
personnel practices, including hiring, promotion, and compensation, when it conducts
compliance evaluations of contractors. OFCCP also monitors contractors’ and subcontractors’
compliance with affirmative action obligations. With more than $1 trillion allocated in the
Infrastructure Investment and Jobs Act, OFCCP will play a vital role in ensuring these federal
investments create good jobs that provide equal opportunity to all. This audit will focus on the
effectiveness of OFCCP’s enforcement of anti discrimination and affirmative action obligations
through compliance evaluations.
OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION (OSHA)
Discretionary Audits
34. COVID-19: Assessment of OSHA Pandemic Program Results – New. The World Health
Organization declared the COVID-19 outbreak a public health emergency of international
concern on January 30, 2020, and ended its declaration on May 05, 2023. As of June 9, 2023,
the OIG’s pandemic response oversight work has resulted in 35 published audit reports with
90 recommendations to reduce programmatic vulnerabilities and $68.7 billion in funds for better
use. Of these 35 audits, 9 were directed at improving the efficiency, economy, and effectiveness
of OSHA operations during the pandemic. For example, we found that, despite receiving
15 percent more complaints in 2020 than in 2019, OSHA conducted 50 percent fewer inspections
and did not identify federal partners in a position to assist during a large-scale health crises such
as the pandemic. Similarly, we found OSHA lacked complete information on employer-reported injuries
and illnesses, including COVID-19 infection rates at worksites. We also found OSHA closed
inspections without ensuring it received and reviewed all items requested from employers to
demonstrate alleged COVID-19 health hazards had been mitigated. Due to the lack of citations,
incomplete information on infection rates at worksites, and insufficient evidence of hazard
mitigation, there was a heightened risk of workers being exposed to the virus. This assessment
will determine the actions OSHA has taken to address these issues and the efforts underway to
ensure improved processes during future states of emergency.
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OFFICE OF LABOR–MANAGEMENT STANDARDS (OLMS)
Discretionary Audit
35. OLMS Enforcement of Employer and Consultant Reporting Requirements – In Progress.
OLMS promotes transparency throughout the labor community by enforcing multiple reporting
obligations. The Labor–Management Reporting and Disclosure Act of 1959 requires employers,
labor relations consultants, and other entities to report certain expenses and agreements to the
Department of Labor, such as those relating to activities to dissuade or persuade employees
from exercising their rights to union representation or collective bargaining. The disclosure of
this information is necessary to protect the rights and interests of employees. Even though these
reports are legally required, there is evidence suggesting many employers and their consultants
are not filing them. In 2021, the National Labor Relations Board found at least 1,125 union-organizing
campaigns, and employers hired persuader consultants in approximately 75 percent of those
campaigns. However, OLMS received only 166 required reports. As a result, OLMS requested
the OIG review its efforts to enforce the Act’s requirements and improve employers’ and
consultants’ reporting.
OFFICE OF THE ASSISTANT SECRETARY FOR ADMINISTRATION AND
MANAGEMENT (OASAM)
Mandatory Audit
36. Federal Information Security Management Act (FISMA) Audit – Annual. In performing its
various missions, DOL collects and processes sensitive information through approximately
77 major information systems. FISMA recognizes the significant risks involved with IT and its
important role in fulfilling agency missions. As such, FISMA sets a framework for securing all
federal government systems by developing security standards and methods for measuring
the effectiveness of those security standards. This audit will focus on the status of the
DOL Information Security Program in implementing an effective framework to secure DOL
information systems.
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Discretionary Audits
37. DOL IT Contingency Planning Audit – In Progress. IT Contingency Plans are a key
component for the recovery and continuity of operations when disasters (natural disasters
or malicious actors) strike an agency or its IT systems. The Office of the Chief Information
Officer (OCIO) is now the Authorizing Official of DOL’s 65 IT systems and is responsible for the
continuity of these mission critical systems. As such, the requirements for contingency plan
testing of all those systems now fall to the OCIO staff. Prior FISMA work indicated problems with
OCIO’s contingency planning, including not ensuring sufficient backup testing of its systems.
With incomplete or impartial contingency planning of so many systems across a variety of
agencies and geographic areas under OCIO’s purview, the potential for substantial system
downtime or non-recovery of data when a contingency arises is elevated. The lack of availability
of DOL systems could impact the Department’s ability to fulfill its critical missions and legislative
requirements. This audit will focus on what efforts OCIO is undertaking to maintain and test the
contingency plans across all DOL systems, with particular focus on the 65 systems under OCIO’s
direct control.
38. DOL Wireless Network Environment – In Progress. DOL’s wireless network has been
deployed across all 50 states at approximately 400 locations within all DOL owned and
associated buildings for DOL’s 20,000 users. Wireless networks are being deployed to replace
DOL’s current hardwired (cables) infrastructure. Wireless technology inherently contains high
risks if not properly configured or maintained, as the information can be received by anyone
within the range of the wireless device. Without operating secure wireless networks that include
boundary controls between networks and active monitoring, DOL is vulnerable to the breach
of its high-value IT assets, which could cripple DOL operations and result in the loss of highly
sensitive data. Our audit will focus on whether DOL deployed and operated a secure wireless
network infrastructure across all of its agencies and supported and/or funded mission sites. We
intend to not only focus on the policy and procedures but also test the effectiveness of DOL’s
implementation through technical testing.
39. IT Modernization – In Progress. IT modernization is critical to preventing security breaches,
excessive costs, missed deadlines, and low-quality IT products and services. DOL transitioned
to an IT Shared Services model, providing OASAM greater control over IT and IT funding. This
audit focuses on the management of IT modernization efforts across the Department, including
software integration, legacy systems, and shared services.
166 Semiannual Report to Congress | April 1, 2023–September 30, 2023
OIG FY 2024 Audit Workplan
OFFICE OF THE ASSISTANT SECRETARY FOR POLICY (OASP)
Mandatory Audit
40. DOL Implementation of Geospatial Data Audit – Biannual. Congress enacted the Geospatial
Data Act of 2018 (GDA) to foster efficient management of geospatial data, technologies, and
infrastructure through enhanced coordination among federal, state, local, and tribal governments,
along with the private sector and academia. The GDA applies to federal agencies that collect,
produce, acquire, maintain, distribute, use, or preserve geospatial data. To improve the
management and oversight of geospatial data and related investments, the GDA identified
13 requirements for federal agencies to implement. This audit will focus on the extent DOL
implemented the requirements and improved its management of geospatial data.
OFFICE OF THE CHIEF FINANCIAL OFFICER (OCFO)
Mandatory Audits
41. DOL Consolidated Financial Statements Audit – Annual. We will determine if DOL’s
consolidated financial statements present fairly, in all material respects, the financial position of
DOL as of September 30, 2024. We will consider DOL’s internal controls over financial reporting
and test DOL’s compliance with applicable laws, regulations, contracts, and grant agreements
that have a direct and material effect on the consolidated financial statements.
42. Review of DOL’s Improper Payment Reporting in the Annual Financial Report – Annual.
In FY 2022, the UI program and Federal Employees’ Compensation Act (FECA) reported
outlays of $85.2 billion and $2.9 billion, respectively, with an estimated improper payment rate
of 21.52 percent and 3.03 percent, respectively. Based on DOL’s risk assessments, the UI and
FECA programs continue to be considered the most susceptible to improper payments of all DOL
programs. This audit will determine if DOL complied with the Payment Integrity Information Act
of 2019, which required DOL to (1) conduct a program specific risk assessment for each required
program or activity; (2) publish and meet annual reduction targets for each program assessed
to be at risk for improper payments; and (3) report information on the efforts of each program to
reduce improper payments.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 167
OIG FY 2024 Audit Workplan
OFFICE OF WORKERS’ COMPENSATION PROGRAMS (OWCP)
Mandatory Audits
43. Report Relating to the Federal Employees’ Compensation Act Special Benefit Fund –
Annual. We will determine if (1) the Schedule of Actuarial Liability, Net Intra-Governmental
Accounts Receivable, and Benefit Expense was fairly presented for the year ending September
30, 2024; and (2) internal controls over financial reporting related to the Schedule were in
compliance with laws and regulations that could have a direct and material effect on the
Schedule.
44. Longshore and Harbor Workers’ Compensation Act (LHWCA) Special Fund – Annual. We
will determine if DOL’s LHWCA Special Fund financial statements presented fairly, in all material
respects, the financial position of the LHWCA Special Funds as of September 30, 2023.
45. District of Columbia Workmen’s Compensation Act (DCCA) Special Fund Financial
Statement Audits – Annual. We will determine if DOL’s DCCA Special Fund financial
statements presented fairly, in all material respects, the financial position of the DCCA Special
Funds as of September 30, 2023.
46. FECA Statement on Standards for Attestation Engagements No. 18 – Annual. We will
determine if DOL’s Integrated Federal Employees’ Compensation System transaction processing
for application and general controls, as described in the report, were fairly presented, suitably
designed, and effectively operating for the period October 1, 2023, through June 30, 2024.
Discretionary Audits
47. OWCP Longshore War Hazards Compensation Act Claims – New. OWCP provides
compensation for the injury, disability, death, or enemy detention of employees of contractors
with the United States, and for other purposes as part of its responsibilities from the War
Hazards Compensation Act, which is an important aspect of the Defense Base Act. Over the
past 2 years, Congress has raised concerns about OWCP’s (1) timeliness and thoroughness in
processing War Hazards Compensation Act claims; (2) possible backlog of unprocessed and/or
unpaid claims totaling hundreds of millions of dollars; and (3) processes for securely collecting
and safeguarding associated claims data. This audit will examine the effectiveness of OWCP’s
claims processing efforts in this area over the past 5 years and OWCP processes for securely
collecting and safeguarding claims data from insurers, including any Personal Identifiable
Information (PII) and Personal Health Information (PHI).
168 Semiannual Report to Congress | April 1, 2023–September 30, 2023
OIG FY 2024 Audit Workplan
48. OWCP Medical Bill Payment Processing Data Integrity Follow-Up – New. In 2020, OWCP
launched a new medical bill payment processing system, the Workers’ Compensation Medical
Bill Processing (WCMBP) system. In 2021, we initiated an audit to assess the processes and
controls over OWCP’s medical bill payment data from this system and other OWCP systems
that collect, process, and share the data necessary to manage the Workers’ Compensation
Programs. OWCP was unable to demonstrate the design and effectiveness of its controls
over its medical bill payment processes. Based on this, we ended the audit and concluded
OWCP’s medical bill payment data was of undetermined reliability. Since concluding our
testing, OWCP has stated the issues preventing our continued testing have been remedied.
As OWCP, its programs, and its stakeholders rely on accurate and complete data from this
and other OWCP systems, we decided to follow up on our recommendations and complete our
data reliability testing. This audit will assess OWCP’s processes and controls to determine the
reliability of OWCP’s medical bill payment processing data necessary to manage the Workers’
Compensation Programs.
49. OWCP Pharmacy Benefit Manager (PBM) – New. In March 2021, OWCP implemented a PBM
responsible for pharmaceutical transactions including but not limited to eligibility determinations
and pricing for prescription drugs for the FECA program. In FY 2021, FECA provided almost
$3 billion in benefits to more than 183,000 workers and survivors for work-related injuries or
illnesses. This audit will focus on how effectively OWCP’s PBM reduced opioid-related risks,
pharmaceutical costs, and fraud.
50. Energy Employees’ Claims Denials – In Progress. From its inception to the end of FY 2020,
the Energy Workers program awarded approximately 127,000 claimants’ compensation and
medical benefits totaling more than $18.52 billion. One of the major functions of the Energy
program is to determine whether an individual qualifies for Part B and/or Part E benefits. As of
October 3, 2021, the Energy program had denied 42 percent of claims filed under Part B and
47 percent of claims filed under Part E. This audit will determine the extent to which the program
ensured claims followed appropriate guidelines.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 169
OIG FY 2024 Audit Workplan
VETERANS’ EMPLOYMENT AND TRAINING SERVICE (VETS)
Discretionary Audits
51. COVID-19: Effectiveness of Homeless Veterans’ Reintegration Program (HVRP) Grants
– New. HVRP is the only federal grant to focus exclusively on competitive employment for
homeless veterans. Of all VETS programs, veterans experiencing homelessness were the most
difficult population to serve during the COVID-19 pandemic. Many facilities and partner agencies
shut down due to the public health emergency. VETS also experienced challenges pivoting to
and providing virtual services to this population during the pandemic. This audit will focus on the
effectiveness of HVRP meeting the needs of homeless veterans as well as VETS’s oversight of
the program.
52. COVID-19: Jobs for Veterans State Grants (JVSG) Program – New. The COVID-19
pandemic presented new challenges for VETS in its mission to prepare America’s veterans and
transitioning service members for meaningful careers; provide them with employment resources
and expertise; protect their employment rights; and promote their employment opportunities.
Its JVSG program provides individualized career services to veterans with significant barriers
to employment, with the maximum emphasis directed toward serving veterans who are
economically or educationally disadvantaged. The program also conducts outreach to employers
and business associations and engages in advocacy efforts with hiring executives to increase
employment opportunities for veterans and encourage the hiring of disabled veterans. The audit
will focus on how the pandemic impacted the JVSG program as well as the effectiveness of this
program during a health crisis.
WAGE AND HOUR DIVISION (WHD)
Discretionary Audit
53. Child Labor Law Violations – In Progress. The Fair Labor Standards Act of 1938 is the federal
law that sets minimum wage, overtime, recordkeeping, and youth employment standards. The
Act includes child labor provisions (i.e., laws) to protect the safety, health, and wellbeing, as well
as educational opportunities, of working young people. These provisions are enforced by the
Department’s Wage and Hour Division (WHD). Violations of child labor laws and proposals to
roll back protections are increasing nationwide. For example, in 2022, WHD reported the highest
number violations related to minors in hazardous occupations. Concurrently, states appear to be
pursuing legislation to reduce child labor protections. Ten states have introduced, considered, or
passed legislation rolling back protections for young workers within the past 2 years. This audit
will focus on WHD’s efforts to curtail child labor law violations and determine the cause for rising
child labor law violations.
170 Semiannual Report to Congress | April 1, 2023–September 30, 2023
OIG FY 2024 Audit Workplan
MULTI-AGENCY
Mandatory Audits
54. Charge Card Risk Assessment – Annual. The Government Charge Card Abuse Prevention
Act of 2012 was designed to prevent recurring waste, fraud, and abuse of government charge
cards, and requires agencies to implement safeguards and internal controls to reduce these
risks. This audit will determine if DOL established controls over its purchase and travel card
programs to prevent and detect illegal, improper, or erroneous purchases and payments.
55. Single Audit Compliance, Quality Control Reviews of Single Audit Reports – Annual.
We will determine if selected independent auditors complied with the requirements of the Office
of Management and Budget’s Uniform Guidance, Government Auditing Standards, Generally
Accepted Auditing Standards, and if there is a need for any follow up work.
Semiannual Report to Congress | April 1, 2023–September 30, 2023 171
Appendices
Acronyms and Abbreviations
ARPA American Rescue Plan Act of 2021 IOC-2 International Organized Crime
BLS U.S. Bureau of Labor Statistics Intelligence and Operations Center
CARES Act Coronavirus Aid, Relief, and IT information technology
Economic Security Act Key & Associates Key & Associates, P.C.
C.F.R. Code of Federal Regulations KPMG KPMG LLP
Charge Card Act Government Charge Card Abuse MSHA Mine Safety and Health
Prevention Act of 2012 Administration
Department or DOL U.S. Department of Labor NASWA National Association of State
DOJ U.S. Department of Justice Workforce Agencies
EBSA Employee Benefits Security OIG Office of Inspector General
Administration OMB Office of Management and Budget
EIDL Economic Injury Disaster Loan OSHA Occupational Safety and Health
Energy Energy Employees Occupational Administration
Illness Compensation Program OWCP Office of Workers’ Compensation
ERISA Employment Retirement Income Programs
Security Act of 1974 PERM permanent employment
ETA Employment and Training certification program
Administration PEUC Pandemic Emergency
EUISAA Emergency Unemployment Unemployment Compensation
Insurance Stabilization and PII personally identifiable information
Access Act of 2020 PIIA Payment Integrity Information Act
EURGENO Emergency Unemployment Relief of 2019
for Governmental Entities and PPP Paycheck Protection Program
Nonprofit Organizations PRAC Pandemic Response
FBI Federal Bureau of Investigation Accountability Committee
FECA Federal Employees’ Compensation PUA Pandemic Unemployment
Act Assistance
FISMA Federal Information Security QCR Quality Control Review
Modernization Act Recovery Act American Reinvestment and
FLC Foreign Labor Certification Recovery Act of 2009
FPUC Federal Pandemic Unemployment Rocha Rocha & Company, PC
Compensation Secret Service U.S. Secret Service
FY Fiscal Year/fiscal year Silica Respirable Crystalline Silica
GAO Government Accountability Office SWA State Workforce Agency
GenTech GenTech Associates Treasury U.S. Department of the Treasury
H-1B visa program for workers in TFFF Temporary Full Federal Funding
specialty occupations of the First Week of Compensable
H-2A visa program for agricultural Regular Unemployment for States
workers with No Waiting Week
H-2B visa program for non-agricultural Trust Fund Black Lung Disability Trust Fund
workers UI Unemployment Insurance
iFECS Integrated Federal Employees’ U.S.C. United States Code
Compensation System WIOA Workforce Innovation and
IDH Integrity Data Hub Opportunity Act
172 Semiannual Report to Congress | April 1, 2023–September 30, 2023
Office of Inspector General, U.S. Department of Labor
200 Constitution Avenue, NW
Room S-5506
Washington, DC 20210
To learn more about the Office of Inspector General’s current and planned work,
please visit www.oig.dol.gov.
Office of Inspector General
United States Department of Labor
Report Fraud, Waste, and Abuse
Contact the Hotline
202.693.6999 or 800.347.3756
Fax: 202.693.7020
www.oig.dol.gov
The OIG Hotline is open to the public and to federal employees
24 hours a day, 7 days a week, to receive allegations of fraud, waste,
and abuse concerning Department of Labor programs and operations.
OIG Hotline
U.S. Department of Labor
Office of Inspector General
200 Constitution Avenue, NW
Room S-5506
Washington, DC 20210
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