State recovers $495,000 in stolen unemployment benefits with ‘innovative’ legal strategy
An estimated $640 million in fraudulent unemployment claims were withdrawn from the Washington Employment Security Department over the course of the pandemic. The Washington Attorney General’s office announced Monday that it has succeeded in repossessing some of that money with an innovative legal strategy.
Asset forfeiture dates back to the colonial era when port authorities wielded the law to seize cargo that had evaded customs. Today, it is exercised in Washington state to the tune of an estimated $11 million in seizures a year, usually within the context of drug crime. It typically enables police to obtain certain assets that are alleged to have been connected with illegal activity.
Attorney General Bob Ferguson has applied that strategy for the first time to repossess $495,000 in fraudulent unemployment claims.
On Oct. 25, King County Superior Court Judge Johanna Bender granted the attorney general’s first motion for forfeiture, ordering TD Bank to transfer back $495,000 from 120 accounts where the stolen funds had been deposited.
“My legal team is using every tool in our toolbox to recover stolen dollars,” Ferguson wrote in a press release. “Stay tuned because we’re not done.”
The process involved the subpoena of more than 35 banks across the state to identify accounts that had received unemployment benefits from multiple states, people, or had inconsistent personal identification.
As of June 18, 2021, ESD estimated it paid out approximately 96,000 known or probable fraudulent claims totaling over $640 million. Washington state has recovered a portion of the fraudulently paid funds. However, as of June 18, 2021, an estimated $315 million in stolen funds had yet to be recovered.