Thursday, September 7, 2023

Mississippi Suffered Nearly $600 Million in Covid-Relief Fraud

 State Auditor Shad White issued the following statement. 

A new report released today by State Auditor Shad White shows over $590 million in unemployment compensation was misspent in Mississippi alone during the COVID-19 pandemic. The U.S. Department of Justice has called the unemployment fraud around the nation during COVID “unprecedented.” Today’s report also highlights the Office of the State Auditor’s use of advanced data analytics tools such as geospatial and multi-datapoint analysis to investigate widespread fraud.

"The pandemic response resulted in a historic amount of taxpayer money wasted. Some of this money is simply gone forever,” said State Auditor Shad White. “But my office is using the fraud as an opportunity to use new audit tools, like advanced data analytics that will hopefully pay dividends in the future."

In fiscal year 2020, unemployment claims in Mississippi ballooned to over $2.1 billion from the previous year's $59.6 million—a 3,500% increase. These increased benefits resulted in massive fraud and misspending. One reason the fraud occurred is the Mississippi Department of Employment Security (MDES) bypassed or altered its fraud-prevention systems. For instance, MDES

·         Waived the need for social security number verification on claims approvals

·         Waived the one-week waiting period for unemployment claims

·         Waived the requirement for applicants to show they were searching for work

·         Increased the Weekly Earning Allowance increase from $40 to $200

·         Altered the requirement that applicants show separation from ALL employers

The Auditor’s Office has partnered with an advanced data analytics firm to identify improperly paid unemployment claims, recover stolen funds if possible, and hold fraudsters accountable. The State Auditor’s office has partnered with federal agencies to assist in these investigations, which have already led to the arrests of Aubrey Martinez in November of 2022 and John Evans Jr. in December of 2022.





53 comments:

Anonymous said...

A complete waste of money Shad! You have no authority to prosecute anyone for anything. This is just you show boating for the voters! How about spending taxpayer's money on something useful?

Anonymous said...

8:49, where do you think the COVID money came from? So you are okay with stealing tax money on the one hand, and yet chide the auditor for going after those who stole it?

Anonymous said...

How the hell can you call this a waste of money! If you work for MDES, say so! Anybody complicit in making the decision to dispense with security protocol, if not already fired, should be fired today.

That agency is federally funded, not state funded. Some of that money can be recovered-paid back to its proper fund source.

Much of it can be recovered by prosecuting, or holding liable, known claimants who illegally used the system to benefit themselves.

It's my understanding that the Agency's Executive Director was allowed to resign over a year ago. More need to go. Just as with the state welfare agency, this one answers directly to the governor and by gubernatorial appointment, these directors sit in revolving chairs beside revolving doors.

Anonymous said...

Worthy cause but this is a rabbit hole.

Ultimately, Shad will falsely accuse people of stealing or find some low-hanging fruit ($500) and tack on investigation fees and interest to claim someone stole $25,000. He'll ruin a life and pat himself on the back.

Anonymous said...

Honest question. MDES waived all the normal checks and balances during a certain time frame. Is Auditor going to go back through those payments as if they weren't waived? Hate to see a 3,500% increase, but they all had to know if fraud-prevention systems waived....

Thank You Mr. White said...

@ 8:49. You may not know it, but the Auditor's job is to investigate, reach conclusions and report....as well as, in some cases, make arrests.

You people are all into arresting and convicting those responsible at another state agency for mis-spending (cough) millions - Why would you suggest giving THIS agency a pass?

Anonymous said...

Fraud of public funds in Mississippi? I am shocked. These thieves were raised to steal. "But everybody does it."

Fortunately I pay zero in federal and state income taxes and thus don't feed the welfare/entitlement/foreign aid honey bucket.

Anonymous said...

Refresher for 8:49 AM:

auditor (noun)
au·​di·​tor [ȯ-də-tər]
1: a person qualified and authorized to examine and verify financial records

An auditor is an individual who examines the accuracy of recorded business transactions. Auditors are needed in order to verify that processes are functioning as planned, and that the financial statements produced by an organization fairly reflect its operational and financial results.

Anonymous said...

@8:49 AM Larry Bradford, thanks for checking and trolling.

It is noted that if Shad's office hadn't investigated this fraud you would be criticizing him, troll.

Anonymous said...

Let's rate the auditor:

"highlights the Office of the State Auditor’s use of advanced data analytics tools such as geospatial and multi-datapoint analysis to investigate widespread fraud"

That's a 7.5 on the Bee Ess Words Scale!

Only a 3.5 on the Dazzle With Distractions, major downgrades for not mentioning a task force or need to increase taxes on businesses!

Anonymous said...

8:49 am I don't know if you are one of the fraudsters, being paid by foreign interest or just a dumb or criminal, but I hope to hell you aren't a Democrat or Republican in good standing with either.

Revealing that this is beginning to look like THE most corrupt administration in decades as recent scandals suggest, should be something to cheer for all honest people...especially those of us old enough to remember when honorable men made government work better for all of us.

I do not hold it against any leader who is makes an appointment or relies upon someone he has no reason to distrust. I hold the person accountable and lose trust in them or the party, if either doesn't want punishment for wrongdoing.

Those of us who are actually conservatives instead of hacks for either party, are very upset to see the GOP defending criminal behavior, pardoning convicted criminals who have no remorse, accepting bizarre behavior and violence and embracing not just lies of omission but bold face lies as acceptable political strategy.

I trust a jury to decide the fate of Hunter Biden and Trump et. al. Maybe because I did my duty every time I was called to jury duty and actually have been a juror. It is a duty not taken lightly by those willing to serve. And, the occasional liar or idiot is quickly identified and either embarrassed into doing the right thing or is made known. We all know go in knowing we have the ability to rid ourselves obstacle to do our due diligence.

And, by the way, because you don't bother to be a good citizen. Let me tell you the votes of the dead CAN BE COUNTED IF THEY WERE ALIVE WHEN THEY VOTED. You are with the idiots who likely think that if you get run over walking to your car after voting, your vote should be thrown out. So lies of omission and ignorance are killing the GOP and will make me one of the 70% of Americans who are thoroughly disgusted! And, beware, even in Mississippi, if this keeps up the day will come when we are either again isolated and seen as a joke or these fools will be gone!






Anonymous said...

$78.1 billion in potentially fraudulent Economic Injury Disaster Loans and $3.6 billion in Paycheck Protection Program loans to possibly ineligible recipients.

https://www.nbcnews.com/politics/justice-department/biggest-fraud-generation-looting-covid-relief-program-known-ppp-n1279664

If you are an actual taxpayer, middle class, you'll just throw up to see this.

And then Google Environmental Working Group Farm Subsidy database and names of the rich asking for Pump Money or complaining here about their duck lodge flooding, just for fun. Then search the PPP database for your neighbors with new cars and beach houses, courtesy Uncle Sam, who may not have deserved it or exaggerated their claims.

You can advise the SBA and IRS that they may not Really have had the number of employees and revenue that they claimed for PPP, if that's so.

The SBA’s inspector general has identified $78.1 billion in potentially fraudulent Economic Injury Disaster Loans, another Covid relief program for businesses, just to date. The Secret Service has its own estimate: $100 billion.

The basic scheme, Talcove said, was “really simple.” People went on state websites and took the names of existing businesses or registered new, fake ones.

“There's absolutely no security on there. There's no validation of any information,” Talcove said. “And voila, you have company ABC with 40 employees and a payroll of $10 million. And you go and apply for a PPP loan. It was a piece of cake.”

So honest businesses may be queried for other's illegal use of their company name, even if they were legit. And Banksters have absolute immunity cuz SBA.

And a lot of PPP fraud was just fake names or numbers of employees. All "forgiven." Including for felons or those under indictment. No questions asked. The felons knew this. The GubMint was warned, and ignored the warnings.

Our state, and all the others panicked, and avoided rapid verification of ANYTHING. And now, like in Rankin County, we taxpayers will pay for it, for generations. Not performing due diligence. Or, say, water plant maintenance.

So, DOJ has prosecuted 178 folks. Wowser.

Look at this excerpt: "Talcove, whose company maintains huge databases of public records and sells verification services to governments, says the government and the lenders and banks could and should have prevented such widespread fraud.

When Covid relief was proposed, he said, he spoke to Larry Kudlow, then a top economic adviser to President Donald Trump.

“And I explained to him that this was going to be the biggest fraud in the history of our country. And then I was told that you can have speed or you can have security. And that they'd rather just get the money out.”

Talcove said he told Kudlow that banks have the ability to rapidly identify their customers.

Kudlow didn’t respond to requests for comment."

And, Kudlow was a DNC operative, campaigning for Dem Senators, before he was a GOP guy. It's BOTH parties, all working for Wall Street who profited.

Then think about what AI will do to speed up the bilking of GubMint. Cuz who doesn't want the latest, greatest,..... in the private sector C Suites and DC. They don't have to pay for it.

Anonymous said...

Every two weeks the gov takes money out of my check...money that I earn. They waste and/or steal most of it right off the top and do who knows what with the rest. Are you ok with that? I am not. I'd kinda like to know stuff like this myself.

Anonymous said...

What a catastrophic and life altering event we lived through, watching our government fumble at every turn.

The incompetence and lack of preparedness seems to be immeasurable.

Anonymous said...

Pulling the cover off more than half a billion dollars in theft enabled by the Mississippi Department of Employment Security is solid work.

Heads should roll.

Anonymous said...

Yeah, well, net the small fry if you can, but any big fish, you’re going to have to throw those back, Shadster.

Anonymous said...

8:49 How is trying to recoup stolen money not useful? It’s basically stolen. Before you say, but but Phil… I think Shad should recoup any monies that is owed to the state no matter the political affiliation.

Anonymous said...

Some socialists come on here criticizing enforcers who find evidence of theft and fraud. Are these same in that racket and feel they deserve a get-even bonus to supplement gambling, exotic travel, other beyond their means expenses, albeit illegal?

Anonymous said...

@8:49 - lighten up, Francis.

Anonymous said...

It worked for Ray Mabus, it will work for Shad.

Anonymous said...

Why can’t Shad’s office do data analytics without outsourcing?

Anonymous said...

8:49AM is obviously a troll. I guess the State Auditor doesn't "prosecute" anyone, but there are certainly a lot of people in jail because their investigations led to prosecutions. I am sometimes a critic of Shad for going after too many small fish and not the big ones, but this is a big one and some of these were systematic and he should be going after them.

Anonymous said...

To be honest, this seems like a sloppy report from Shad where conclusions are made without the supporting facts. Shad states that 10% of Covid money spent was fraud and links this report as the citation: https://www.gao.gov/assets/gao-23-106647.pdf

The report doesn’t say anything about fraud, so maybe he just got confused?

He later states he estimates $500 million in fraud, but fails to say why that estimation is reasonable or how he got to that number.

WISEOWL said...

I didn't get any money, can we have a do over?

Anonymous said...

And where was Shad while all this government fraud was happening? Working on a press release?

Anonymous said...

>>Why can’t Shad’s office do data analytics without outsourcing?

How else do you expect him to meet campaign donors for his run for governor?

Spreading other peoples money in the form of contracts is the only way to git-r-dun.

Anonymous said...

@ 10:02

Because its a pretty tall order to get a (good) statistician for a state government salary

Anonymous said...

Start at the top of the list of employees at MDES and fire everyone from the top down. Do that with every department of government employees. You will be suprised at how fast the money stealing stops.

Anonymous said...

$600 million in fraud and only 2 prosecutions thus far? Great job Shadrack!

Anonymous said...

15 billion in fraud was from foreign entities.
When COVID started I can just see Bennie Thompson calling all of his friend giving them the playbook on how to get all of that PPP fraud.

Anonymous said...

That money bought a lot of bling, blow, wheels, and cruises.

Anonymous said...

Kudos to shad's staff for doing their job. What's troubling is that shad claims $590 million in fraud but only 2 arrests?? If the auditor's office "knows" of fraudulent overpayments, then why haven't there been more arrests?
It's another example of shad jumping up and down and screaming, "Look at me! Praise me for minimal results."

Anonymous said...

This was a quick turnaround, how long did he take to catch the welfare fraud, that was federal money too.

Anonymous said...

I put this squarely on MDES-

Anonymous said...

@10:51 the decision to bypass the rules was not made by MDES employees. That came from the Democrats @ the federal level. It is called vote buying. They wanted to get that money in anyone who would take it hands as fast as possible. All part of the big COVID scam.

Anonymous said...

The real fraud was committed by the ones who put this covid shutdown horseshit on the population of Mississippians. Looking at you Tate and Thomas Dobbs... oh and they never missed a payday.

Anonymous said...

Dear 12:15
Please free your mind from the maga cult and learn to think for yourself. If you had bothered to actually read the report and learn facts instead of automatically blaming democrats, you would have learned that the diminished MDES controls occurred in 2020, which means it's your beloved maga cult members that eliminated the controls. The maga crowd is playing you like a cheap violin in the hope that you never learn to think for yourself.

Anonymous said...

@10:51 am - Your theory would work quite well in the private sector too. There are thieves in private sector and we pay higher prices because of it.

Anonymous said...

This cost employers millions as well in unemployment tax increases.

“EXPERIENCE RATING” might not be a phrase most are familiar with, but if you are an employer of any size it could mean 10’s of thousands of dollars STOLEN from your business through higher unemployment tax rates.

The experience rating is how MDES determines how much an employer has to pay into the unemployment fund for Mississippi. It is based on how many unemployment claims an employer has had in the past and is calculated as a percentage of a business’s overall payroll. Even a 1% increase could cost a small business thousands every year.

Imagine you are a small business who has treated your employees well for decades, lost money at times to keep from laying people off, and as a result have a very low experience rating. Then imagine you get a notice that your experience rating has quadrupled because MDES has removed all road blocks to prevent fraud. Has stopped even sending notices to employers that an unemployment claim has been filed against you, giving you a chance to protest. Imagine finally getting the information on who it is that claimed they were fired and discovering its individuals that were fired for walking off the job 4 years prior and used your company name to fraudulently get unemployment.

Here you are years afterwards with an inflated experience rating continuing to coast your small business thousands every year with no recourse.

Anonymous said...

@ 12:15 PM - There is zero federal supervision of MDES by the feds. If federal money is being dispersed, then the feds can regulate the conditions under which the disbursement takes place.

If the money was federal funds, in addition to state funds (employer taxes) and the feds instructed the agency to dispense with its regulations, then Shadracks audit findings should state that fact.

But the feds do not, cannot and won't tell a state agency to dispense with their normal safety protocol, otherwise.

Meanwhile, Shad should take a look at the contract workers, some prior employees, being used by that agency TODAY to engage in deception and cover-up.

Rolling the head of the Director, a female who was a prior clerk there before advancing through several years, is not an adequate response to the doors to the vault being left wide open.

Anonymous said...

Shad needs to do a quick audit to see how many Inmates have family members drawing unemployment benefits while incarcerated. I personally know of an inmate who's brother drew unemployment under his incarcerated brothers name and SS #.

Anonymous said...

Several years ago I spent 2 years on a Federal Grand Jury. 1 to 2 days a month for 2 years. I learned a lot. Number one was , If you are going to commit fraud your best shot was a state or federal government agency. The ones we convicted were caught only because one of their co-conspirators ratted them out because of a girl friend or they didn’t think their cut was fair. I don’t Romberg one case where an internal investigation or one of the many Federal law Enforcement agencies discovered the fraud.

Anonymous said...

With 78% of Covid fraud going to Republicans, why would Shad want to prosecute?

Anonymous said...

Shocking, just shocking I say! You mean to tell me lazy Mississippians who don’t work, won’t work or can’t work lined up like cord wood to get unemployment benefits to supplement their disability checks, food stamps, welfare benefits and pay for cash jobs they continued to work and don’t ever report to the IRS or State Tax Commission during the pandemic? I’m just flabbergasted my fellow citizens would stoop that low!

Anonymous said...

I have a relative who was an HR Manager in the Jackson area before, during and after the Covid event. He told me there was no mechanism through which he could report to MDES the claimants who refused to return to work when recalled.

Simply put, the agency did not care. They said they were overwhelmed with phone calls and claims and had dispensed with regulations.

That approach was previously unheard of and violates the very handbook-basis for terminating an unemployment insurance claim. But, who gives a shit..."we get off at five!"

Anonymous said...

This is not surprising.

Employment Security was guilty of the same thing after Hurricane Katrina.

There has'nt been any real leadership at that agency since the late 1980's.



Anonymous said...

This was a statistical analysis of the funds distributed versus an estimation of the funds that would be distributed. The original estimation was a wild ass guess that could be incorrect by orders of magnitude from the estimation. and it was incorrect, exactly as predicted by congressional staff and government statisticians. But, it was COVID. The President, congress, the governor and the entirety of federal, state, and local government told people to stay home and businesses to close. Two weeks to stop the spread! In fact the government forced some businesses to close and left them with no ability to even feed themselves because they were not allowed to work and there were not enough businesses open to provide work. So, what is government's responsibility to those people and businesses that were restricted from making a living?

You people act like y'all never even heard of COVID, much less lived through it. The answer was that the government should provide the people and businesses money. Money that people and businesses would have made themselves, if not for the government shutting down the economy. Hell, I am retired and drawing a pension and the government gave me money. Do y'all not remember? Did you send the money back? Or did you spend it.

Comes In 20 Min Late, Takes Coffee Break.. said...

Not sure where you get that 'late 1980s' comment, 9:58.

At one time that agency was respected and respectable and had ONE Executive Director for several decades. Then politics brought in the revolving door of Directors, chosen by governors.

Directors like Linda Aldy (Gov Mabus), Tommy Dyson (Gov Mabus, Lynn Fitch (Gov Barbour) and a host of directors who had zero experience in the field or any background related to the mission of the agency.

Then interim after interim of incompetents, the most recent several being advanced up through the ranks in observance of Mr. Peter's Principle.

Today, that agency has no mission. It's simply a PERS factory. It would take a young Burl Cain to straighten out this mess of an empire.

Anonymous said...

It’s about time for Shad to conduct a study that tells us we need another study.

Anonymous said...

Would be interesting to see how many billions were "justified" (i.e. fraudulent used) for colleges and universities who basically spent money on new technology, facilities, and more that weren't in any way ever even needed.

It was all just part of "never waste a crisis" - and the money flowed like a river regardless of actual need.

Anonymous said...

9:09 PM: Did you ask him why he didn't use the regular process that employers use to notify MDES that a former employee, who is receiving unemployment benefits, refuses to return to work? The employer's normally care a great deal about these things since they pay the check.

Anonymous said...

@ September 7, 2023 at 4:48 PM
You say you learned a lot. You obviously didn’t learn too much. Grand juries don’t convict anyone.

Anonymous said...

Pay attention, 2:57 - That process was not available during the Wuhan Virus. Employers did not have a way to report fraud and the agency was less than interested. Just pump that helicopter and submarine money...that's it.



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