Criminal syndicates that scammed the unemployment system out of billions of dollars in pandemic benefits used some of the money to buy drugs and guns, an inspector general says.
The Labor Department’s watchdog said nearly 20% of the unemployment insurance benefits paid out by California over the first six months of the pandemic went to fraudulent claims.
“Criminal enterprises have discovered that UI fraud is a low-risk, high-reward crime,” the inspector general said. “They have invested fraudulent UI proceeds to further other criminal activity, such as purchasing guns and drugs.”
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