The Department of Government Efficiency, championed by billionaire Elon Musk for its cost-cutting efforts, has reportedly exposed hundreds of millions of dollars in fraudulent unemployment claims.

However, federal investigators had previously uncovered what appears to be the same fraudulent activity, years earlier and on a significantly larger scale.

In a recent post on X, the social media platform owned by Elon Musk, DOGE revealed that an initial analysis of unemployment insurance claims since 2020 identified 24,500 individuals over the age of 115 who had claimed $59 million in benefits, 28,000 people aged between 1 and 5 who had collected $254 million, and 9,700 individuals with future birthdates who had obtained $69 million from the government.

The tweet elicited the expected partisan responses of either doubt or approval, even from Musk, who described his team's findings as "so unbelievable" he reviewed them repeatedly before fully grasping their implications.

"Those statistics are highly unfavourable," he remarked.

Chavez-DeRemer can simply check her department's Office of the Inspector General to see that this kind of fraud was already reported by the same federal workers DOGE has criticized.

"They're attempting to craft a storyline portraying government as inefficient and inept, suggesting they're uncovering issues the government overlooked," asserts Michele Evermore, who addressed unemployment matters at the U.S. Department of Labor during the previous Joe Biden administration. "They're identifying fraudulent activities that were already flagged as such and presenting it as their own discovery."

The Social Security Act of 1935 embedded unemployment benefits within federal legislation, yet it delegated to individual states the responsibility of establishing frameworks for collecting unemployment taxes, managing claims, and distributing assistance.

Even though states mostly control their unemployment systems, special aid programs, like the much bigger benefits started by the first Trump government when COVID began, bring more direct help from the federal government and many new people into the system.

Stephen Wandner, an economist at the National Academy of Social Insurance and author of "Unemployment Insurance Reform: Fixing a Broken System," states that typically, state unemployment systems exhibit performance ranging from proficient to inadequate. However, with the significant economic disruption caused by COVID and the overwhelming surge in new claims exceeding states' capacity, he contends that the performance of many systems deteriorated considerably.

The COVID unemployment relief signed into law by Trump on March 27, 2020, promptly attracted widespread fraudulent activity. Approximately two weeks later, the Department of Labor cautioned state officials in a memo that the enhanced benefits had rendered unemployment programs susceptible to substantial fraudulent claims, often filed using stolen or fabricated identities.

That same memo suggested a way for states trying to protect someone whose identity was stolen to get unemployment benefits illegally. To keep a record of the fraud but stop innocent people from being connected to it, states could make a "pseudo claim," the memo said.

These "pseudo claims" resulted in records indicating that toddlers and centenarians received checks. The Labor Department's inspector general documented approximately 4,895 unemployment claims from individuals over 100 years old between March 2020 and April 2022; however, another departmental memo clarified that these filings originated from states modifying dates of birth to safeguard individuals whose identities had been compromised.

The 2023 memo states that many of the claims found were not payments to people over 100 years old, but were actually 'pseudo records' of fraudulent claims found before.

A spokesperson for the Department of Labor failed to address inquiries regarding Musk's findings, and the DOGE provided no specifics on their process for identifying the alleged fraud or whether their discoveries replicated existing information.

Despite appearing to examine a longer timeframe than previous federal investigations, DOGE only accounted for $382 million in fraudulent unemployment claims, a negligible amount compared to what investigators had already identified.

In 2022, the Labor Department thought that possible unemployment fraud during the COVID-19 pandemic was more than $45 billion. The Government Accountability Office later said it was much higher, probably between $100 billion and $135 billion.

"I doubt this comes as a revelation to anyone," remarks Amy Traub, a specialist in unemployment at the National Employment Law Project. "It has been extensively documented. There have been numerous congressional inquiries."

If DOGE's newest claims sound familiar, it's because they are similar to its earlier findings about Social Security payments made to people who had died and those who were very old. These earlier claims were not true.

This means DOGE is not a good way to communicate, even when there is fraud, like with unemployment claims.

Jessica Reidl works at The Manhattan Institute, a conservative think tank. She strongly believes in saving government money and has written 600 articles about stopping federal waste. While she thinks there is a lot of unemployment insurance fraud, she finds it hard to trust the results from DOGE. She says DOGE has not worked well and may have broken the law.

"When DOGE claims that a very large number of dead people are getting unemployment money, I start to doubt it," Reidl says. "DOGE has not been reliable about that before."

Traub indicated that the surge in pandemic-era unemployment fraud prompted states to enact novel security protocols, and she challenged the notion that Musk's team was highlighting outdated fraud as a contemporary issue.

Business leaders and economists are warning about a national recession, so it's natural to think about unemployment," says Traub. "This is an attack on a very important program and maybe an attempt to reduce public support for unemployment insurance at a time when it is most important.