House Approves Bipartisan Ways & Means Legislation to Recover Nearly $1 Billion in Pandemic-Era Taxpayer Dollars Frozen Due to Fraud

WASHINGTON, D.C. - Hundreds of millions of dollars in unspent COVID-era unemployment insurance (UI) funds will be returned to taxpayers thanks to bipartisan legislation approved by the U.S. House of Representatives. The Recover COVID Unemployment Fraud in Banks Act (H.R. 8873), introduced by Ways and Means Committee members Representatives Beth Van Duyne (TX-24) and Tom Suozzi (NY-03), improves coordination between the federal government and state partners to chart a course for retrieving the nearly $1 billion in unspent COVID UI funds suspected of fraud that have been sitting frozen in local financial institutions for years. The legislation also extends the statute of limitations for prosecuting pandemic unemployment insurance fraud to give law enforcement more time to bring those criminals to justice.

Ways and Means Committee Chairman Jason Smith (MO-08) issued the following statement:

"It has been six years since the COVID pandemic and yet there are still hundreds of millions of federal tax dollars just sitting in banks across this country due to suspicious fraudulent activity. States on their own are not doing enough to reconcile these accounts and recover the American people's hard-earned money. By establishing a federal task force, governments at the federal and state levels will be better coordinated and able to finally close the book on the return of these unused unemployment insurance benefits. By also extending the statute of limitations for prosecuting pandemic-era UI fraud, we will give law enforcement the time they need to go after fraudsters who stole from American taxpayers and from those the UI program is meant to serve."

Recover COVID Unemployment Fraud in Banks Act (H.R. 8873)

• Department of Labor Inspector General (DOL-OIG) recently found nearly $1 billion in unspent COVID-19 unemployment insurance (UI) funds frozen and held by financial institutions across the country due to suspected fraud.
• Without Congressional action, hundreds of millions in taxpayer dollars may go unrecovered.
• The statute of limitations for prosecuting pandemic UI fraud began to expire in March of 2025.
• The bill establishes a federal task force, led by a National Recovery Coordinator, to coordinate with applicable state agencies to identify federal pandemic UI payments issued on prepaid debit cards held by financial institutions or transferred to state agencies responsible for unclaimed property and coordinate return to the appropriate state agency.
• Extends the statute of limitations for criminal prosecution and civil enforcement actions in pandemic unemployment programs from 5 to 10 years.

Read a fact sheet on the bill here.

The bill passed the Committee 41-0.

The bill was approved by the U.S. House of Representatives with unanimous consent.

READ: Three Key Moments: Hearing on Reclaiming "Forgotten" Fraudulent Pandemic Unemployment Funds Frozen by Banks

READ: Three Key Moments: Hearing on Prosecuting Fraudsters for Stealing Billions in Pandemic Unemployment Benefits from American Workers