Kansas has recovered only $11 million—just 2.4%—of the estimated $460 million lost to fraudulent unemployment claims during the COVID-19 pandemic, state labor officials said. At a June 10 hearing, Labor Secretary Amber Shultz called the losses an “extremely stressful and unfortunate” chapter in the agency’s history.
Roughly $292 million of the fraudulent payments came from state funds, with the remaining $168 million from federal sources. An earlier audit put the total fraud at $700 million, but that estimate was revised down.
Kansas’ outdated 1970s-era unemployment system was overwhelmed by the surge in claims during the pandemic, making it a prime target for international fraud rings. With the five-year statute of limitations approaching, prosecutions are becoming more difficult. A bill to extend that timeline has passed the House but remains stalled in the Senate.
The state launched a new claims system last November, which has since helped reduce call volume and improve fraud prevention. Still, lawmakers remain frustrated that Kansas lost far more than states with similar systems, like Colorado.
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