Question: Nationwide, about $163 billion of $872 billion in federal unemployment benefits were improperly paid, due to fraud and other reasons, according to news reports. The improper payment rate of nearly 19% shows the national picture. What was the improper payment rate in Hawaii for federal unemployment dollars? I am among those whose identity was stolen to fraudulently claim unemployment benefits funded by the federal government (taxpayers!) and I believe this issue deserves a lot more coverage!

Answer: The news to which you refer is based on reports from the U.S. Labor Department’s Office of Inspector General (oig.dol.gov) that describe unprecedented theft of pandemic-era federal unemployment benefits from early 2020 to late 2021. The estimated 18.71% national improper payment rate is expected to rise because it does not include the Pandemic Unemployment Assistance program; PUA reports are due this year. PUA, meant for the self-employed and others ineligible for regular unemployment insurance, was the easiest to rip off because claimants could self-certify eligibility in an online application. Your stolen identity was used in a fraudulent PUA claim.

In Hawaii, about $42 million in PUA benefits were improperly paid before certification was tightened, said Bill Kunstman, a spokesman for the state Department of Labor and Industrial Relations. That’s less than 3% of the total $1.5 billion in PUA benefits paid in Hawaii through Oct. 15. Unemployment fraud investigations continue, and so do fraud attempts.

Here’s his full response:

“We are still working with our federal partners (U.S. DOL OIG, FBI and others as part of the National Unemployment Insurance Fraud Task Force) to prosecute fraud perpetrated largely because of the federal programs implemented in response to the COVID-19 pandemic. As you noted, most of the issues the DLIR has encountered occurred in the PUA program, which was initially implemented by requiring self-attestation as part of the eligibility criteria.

“The department instituted a retroactive ID verification requirement in June 2020 that resulted in the denial or cessation of benefits for thousands of PUA claims. We also mailed letters to all PUA claimants notifying them of a claim being filed that resulted in 5,234 reports of identity theft that resulted in the cessation of benefits after nearly $42 million in benefits for those claims were paid out. The DLIR believes these two initiatives severely restricted the ability of fraudsters to obtain benefits from Hawaii’s PUA program.

“However, and notably, the criminal fraudsters are still actively phishing Hawaii residents in ongoing efforts to illegally obtain benefits and perpetrate identity theft. The department has seen a significant increase in phishing scheme attempts to impersonate the DLIR unemployment system in the form of text messages, emails, and social media posts that are perceived to be coming from DLIR to phish for personally identifiable information.

“These sophisticated criminals are using fake websites that accurately resemble the DLIR unemployment website to solicit website credentials and personal information to steal unemployment insurance benefits and other identity theft schemes. The URL for the legitimate Hawaii unemployment insurance claims website is huiclaims.hawaii.gov/#/. For more information, individuals can visit labor.hawaii.gov/blog/main/unemployment-insurance- assistance-fraud-info/ and justice.gov/coronavirus/national-unemployment- insurance-fraud-task-force.”

As for how Hawaii stands against the national rate, it’s not a direct comparison. The national improper payment rate (18.71%) is based on the regular Unemployment Insurance program and has been applied to two federally funded pandemic UI programs, Pandemic Emergency Unemployment Compensation and Federal Pandemic Unemployment Compensation.

Hawaii’s improper payment rate of 5.11% from July 2018 through June 2021 is based on regular UI and two other programs (not PEUC or FPUC). Hawaii is one of only 13 states with a rate under 10%. The improper payment rate reflects overpayments for any reason, not solely fraud.

Write to Kokua Line at Honolulu Star-Advertiser, 500 Ala Moana Blvd., Suite 7-500, Honolulu, HI 96813; call 808-529-4773; or email kokualine@staradvertiser.com.