Shapiro, feds charge 33 with filing fake CARES Act unemployment claims | Wednesday Morning Coffee

August 26, 2020 7:15 am

Good Wednesday Morning, Fellow Seekers.

Here’s a political truism that’s as old as politics itself: if you come up with a good idea or program, it will only be a matter of time before someone figures out a way to play the angles.

Such was the case Tuesday when Pennsylvania Attorney General Josh Shapiro and Pittsburgh U.S. Attorney Scott Brady announced they’d charged more than 30 people, some of them current Pennsylvania state and county prison inmates, with fraudulently applying for unemployment benefits under the CARES Act.

Law enforcement alleged Tuesday that inmates and accomplices on the outside illegally signed up incarcerated people for benefits. In at least one instance, incarcerated people signed up fellow inmates in exchange for cash and drugs, authorities said.

With states, including Pennsylvania, facing unprecedented unemployment, the federal relief package provided $600 a week in enhanced benefits on top of state claims. That enhanced benefit expired at the end of July. However, President Donald Trump signed an executive order providing $300 a week in enhanced benefits, with the states kicking in an extra $100, for a total of $400 a week in enhanced benefits. However, multiple news reports indicate that many of the jobless are still waiting to see that money.

Those who were charged “took advantage of a public health emergency to cash in on the backs of working people across our Commonwealth. They [ripped off] of a program meant for everyday people whose lives were uprooted by COVID-19, some doing so from jail cells in local Pennsylvania prisons,” Shapiro said in a statement.

In that same statement, Brady said the “unprecedented scope and audacity of this inmate unemployment compensation fraud is appalling. These benefits were intended to help Pennsylvania workers make it through a difficult time. These inmates and their accomplices took advantage of this national emergency to line their pockets through fraud.”

Pennsylvania Attorney General Josh Shapiro on Monday announced the arrests of 35 people for drug trafficking and the seizure of drugs, firearms and nearly half a million dollars in cash. He is flanked by local officials and law enforcement, including Police Commissioner Danielle Outlaw (Photo via The Philadelphia Tribune)

Because of the size and scope of the federal spending, some $2 trillion in all, experts predicted last month that it would be vulnerable to fraud and waste.

A July study by the Foundation for Government Accountability, a right-leaning think-tank, concluded that $26 billion in CARES Act funding would be lost to improper spending, Fox Business reported. That’s an amount equal to the unemployment spending by all 50 states in 2019, the online news outlet noted. The estimates were based on data compiled by the U.S. Labor Department’s Office of Inspector General.

“This is a program that’s only existed for a few months, and the amount of potential fraud and waste is 10 times what the entire 50-state system sees [annually], so the $26 billion is … about the same as what the entire nation generally spends on unemployment for an entire year,” Joe Horvath, a policy fellow for the think-tank, told Fox Business.

That outrage was reflected in the arrests announced Tuesday, with one official saying it was worse than mere theft.

“Defrauding U.S. government programs intended to provide economic relief to disaster victims is not simply a matter of theft of U.S. tax dollars. It is far more: it undermines the security and wellbeing of our most vulnerable communities at a time when they are in the greatest in need of assistance,” Timothy Burke, of the U.S. Secret Service’s Pittsburgh Field Office, said in a statement.

The Pennsylvania Capitol building. (Capital-Star photo by Sarah Anne Hughes)

Our Stuff.
In a fall policy roll out, Gov. Tom Wolf said Tuesday that he’ll seek legislative approval of paid family leave, hazard pay and small business grants. He also wants lawmakers to legalize recreational marijuana as the state looks to close a yawning budget deficit. Stephen Caruso has the details.

Republican lawmakers accused Wolf Tuesday of passing the buck as he asked for legislative authorization of an extension of an eviction/foreclosure moratorium set to expire Sept. 1. Under state law, Wolf can’t extend the current moratorium. GOP lawmakers said it’s the product of five months of managing the pandemic without the Legislature’s input, your humble news letter author reports.

Wolf and lawmakers are also trying to reach consensus on a suite of reforms to Pennsylvania’s election laws ahead of the Nov. 3 election. Wolf has called a Senate GOP-backed proposal a good ‘first pass,’ but won’t sign it in its current form, Elizabeth Hardison reports.

Cassie Miller has what you need to know about a Carbon County lawmaker’s plan to let Pennsylvania state parks, the rare refuge in the pandemic, charge admission fees.

Meanwhile, a proposal now pending before Pittsburgh City Council would ban city cops from using facial recognition software, our partners at Pittsburgh City Paper report. They’re already not supposed to do that, but reporting has documented at least one instance where that’s been the case.

On our Commentary Page this morning, opinion regular Fletcher McClellan says the debate over whether to postpone fall sports was only going to end one way. And the Black Lives Matter movement is bigger than just law enforcement-related issues, and lawmakers still have plenty of work to doRep. Dan Frankel, D-Allegheny, writes.

Gov. Tom Wolf speaks at a Middletown child care center Tuesday, August 25 to roll out his fall agenda, including legal weed. (Capital-Star photo by Stephen Caruso)

With infection rates down, Pennsylvania and New Jersey Govs. Tom Wolf and Phil Murphy are, respectively, starting to talk about budgets and other policy priorities, the Inquirer reports.
The Post-Gazette looks at the debate over the looming threat of utility shutoffs — and what to do about them.
The Susquenita Schools in Perry County have shut down after positive COVID-19 casesPennLive reports. The news comes about two weeks after high school athletes in Dauphin County also tested positive.
Some schools in the Eastern Pennsylvania Conference are gearing up for fall sports, others may sit it out, the Morning Call reports.
Officials in Luzerne County have reported 14 new cases of COVID-19 and one death, the Citizens-Voice reports.
The Erie Art Museum is struggling as revenue sources dry up amid the pandemicGoErie reports.

Here’s your #Philadelphia Instagram of the Day:


View this post on Instagram


✨ A quiet Philly sunset

A post shared by Jordan Parenti (@jordanparenti) on

A federal judge has given Philadelphia the green light to remove homeless encampments on the Ben Franklin Parkway and Ridge Avenue in the city, WHYY-FM reports.
Roll Call looks at the emerging national profile of U.S. Rep. Matt Gaetz, R-Fla., who gave a fiery speech at the Republican National Convention.

What Goes On.
10 a.m., G50 Irvis: House Human Services Committee
1 p.m, Boilermakers Local  Lodge 154, Pittsburgh: Senate Environmental Resources & Energy Committee
2 p.m, G50 Irvis: House Democratic Policy Committee

Gov. Tom Wolf
 unveils a monument honoring Harrisburg’s predominantly Black Old Eighth Ward, which was flattened to make way for an expansion of the Capitol complex in the 1900s. The event takes place at 4 p.m. on the lawn outside the Irvis Office Building.

What Goes On (Nakedly Political Edition).
Sen. Gene Yaw, R-Lycoming
, holds a 5:30 p.m. reception at Pittsburgh Field Club. Admission runs $500 to $2,500, based, as ever, on the intensity of your desire to bask in his reflected glow.

Heavy Rotation.
Here’s a lovely tune from Australia’s late, great The Go-Betweens. From their classic LP ‘16 Lovers Lane,’ it’s Quiet Heart.’

Wednesday’s Gratuitous Hockey Link.
got past Boston 4-3 in OT on Tuesday night. The ‘Bolts and Bruins are tied at a game each in their Eastern Conference playoff series.

And now you’re up to date.

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John L. Micek

A three-decade veteran of the news business, John L. Micek is the Pennsylvania Capital-Star's former Editor-in-Chief.