What happens to the fraudsters when they are caught?

All states are required to assess a penalty of not less than 15% of the amount of the fraudulent payment. Other penalties under state unemployment insurance laws generally include:

  • criminal prosecution with fines and/or incarceration;
  • required repayment of fraudulently collected benefits;
  • forfeiting future income tax refunds;
  • and/or permanent loss of eligibility for unemployment compensation.

Commission of unemployment benefit fraud may also be prosecuted by the U.S. Department of Justice in federal courts under 18 U.S.C ยง 1341 or other appropriate federal statutes.

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