[House Report 119-671]
[From the U.S. Government Publishing Office]
119th Congress } { Report
HOUSE OF REPRESENTATIVES
2d Session } { 119-671
======================================================================
RECOVER COVID UNEMPLOYMENT FRAUD IN BANKS ACT
_______
May 29, 2026.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Smith of Missouri, from the Committee on Ways and Means, submitted
the following
R E P O R T
[To accompany H.R. 8873]
The Committee on Ways and Means, to whom was referred the
bill (H.R. 8873) to recover unclaimed pandemic-era unemployment
compensation funds held by financial institutions or escheated
to State unclaimed property administrators, and for other
purposes, having considered the same, reports favorably thereon
with an amendment and recommends that the bill as amended do
pass.
CONTENTS
Page
I. SUMMARY AND BACKGROUND...................................... 4
A. Purpose and Summary................................. 4
B. Background and Need for Legislation................. 4
C. Legislative History................................. 8
D. Designated Hearing.................................. 8
II. EXPLANATION OF THE BILL..................................... 8
A. Reasons for Change.................................. 8
B. Explanation of Provisions........................... 9
C. Effective Date...................................... 10
III. VOTE OF THE COMMITTEE....................................... 10
IV. BUDGET EFFECTS OF THE BILL.................................. 10
A. Committee Estimate of Budgetary Effects............. 10
B. Statement Regarding New Budget Authority and Tax
Expenditures Budget Authority...................... 11
C. Cost Estimate Prepared by the Congressional Budget
Office............................................. 11
V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE.. 11
A. Committee Oversight Findings and Recommendations.... 11
B. Statement of General Performance Goals and
Objectives......................................... 11
C. Information Relating to Unfunded Mandates........... 11
D. Congressional Earmarks, Limited Tax Benefits, and
Limited Tariff Benefits............................ 11
E. Duplication of Federal Programs..................... 12
VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED....... 12
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Recover COVID Unemployment Fraud in
Banks Act''.
SEC. 2. NATIONAL RECOVERY COORDINATOR AND TASK FORCE.
(a) In General.--
(1) Designation of national recovery coordinator.--The
Secretary of Labor, in consultation with the Secretary of the
Treasury, the Inspector General of the Department of Labor, and
the Attorney General, shall designate an official to serve as
National Recovery Coordinator to oversee and coordinate the
activities and responsibilities of the task force described in
paragraph (2).
(2) Task force establishment.--Not later than 30 days after
the date of enactment of this Act, the National Recovery
Coordinator shall convene a task force to be named the
``Recover Pandemic Unemployment Funds in Banks Task Force'' (in
this section, the ``Task Force'').
(3) Members.--The Task Force shall include--
(A) the Attorney General, or their designee;
(B) the Secretary of Labor, or their designee;
(C) the Inspector General of the Department of Labor,
or their designee;
(D) the Secretary of the Treasury, or their designee;
(E) the Chairman of the Federal Deposit Insurance
Corporation, or their designee; and
(F) the Director of the Consumer Financial Protection
Bureau, or their designee.
(b) Task Force Responsibilities.--It shall be the responsibility of
the Task Force to--
(1) coordinate with applicable State agencies to identify
Federal pandemic unemployment compensation payments issued on
prepaid debit cards that--
(A) are held by financial institutions, and other
entities identified by the Inspector General of the
Department of Labor, contracted by a State agency to
transfer such payments to unemployment claimants; or
(B) were transferred by such an entity to, and are
currently held by, a State agency responsible for
unclaimed property;
(2) coordinate with appropriate Federal agencies to develop
model processes which comply with relevant Federal and State
laws and result in cost-effective recovery of the payments
identified under paragraph (1), including issuing guidance, in
coordination with the Secretary of Labor, to administrators of
State agencies responsible for administering Federal
unemployment compensation payments or determining fraud in such
programs, including--
(A) guidelines for--
(i) reviewing such payments and determining
if such a payment was an improper payment;
(ii) determining whether cost-effective
recovery of an improper payment is possible,
including a threshold, or a methodology for
calculating a dollar threshold, for cost-
effective recovery; and
(iii) actions, consistent with State law, to
be taken by the State agency if an improper
payment is determined to be the result of
fraud;
(B) assurances that, subject to section 303(g) of the
Social Security Act (42 U.S.C. 503(g)), any action
taken in relation to a determination that a payment
identified under paragraph (1) is an improper payment
shall be taken under State law;
(C) a model notice and information, developed in
coordination with the Consumer Financial Protection
Bureau, about resources available to individuals whose
identity information is determined to have been
fraudulently used to obtain Federal pandemic
unemployment compensation;
(D) information on the legal pathways described under
paragraphs (3) and (4) for recovery of payments that
are improper payments held by financial institutions
and agencies described in paragraph (1); and
(E) procedural requirements for State agencies to
follow when funds are returned by such institutions
that provides a standardized methodology to return
funds to the Federal Government;
(3) issue guidance, in coordination with the Comptroller of
the Currency and Chairman of the Federal Deposit Insurance
Corporation, to financial institutions described in paragraph
(1) that are holding payments that are improper payments that
provides information on a legal pathway, consistent with
banking regulations and applicable contracts with State
agencies, for returning such payments to the appropriate State
agency; and
(4) issue guidance, in coordination with the Secretary of
Treasury, to administrators of State agencies responsible for
unclaimed property on the obligations of such agencies to
review and return payments described in paragraph (1)(B) to the
appropriate State agency.
(c) Consultation Requirement.--In developing the guidance required to
be issued under paragraphs (2), (3), and (4) of subsection (b), the
Task Force shall consult with State agencies and incorporate best
practices from previous attempts by any such States to recover payments
determined to be improper payments from institutions described in
paragraph (1)(A) of such subsection.
(d) State Administrative Costs.--The Secretary of Labor shall
reimburse States for all administrative costs incurred as a result of
coordination with the Task Force by reason of an agreement under
section 2102, 2104, or 2107 of the CARES Act (15 U.S.C. 9201; 9203;
9205).
(e) Definitions.--Except as otherwise specified, in this section:
(1) Federal pandemic unemployment compensation.--The term
``Federal pandemic unemployment compensation'' means a payment
of--
(A) pandemic unemployment assistance under section
2102(b) of the CARES Act (15 U.S.C. 9021(b));
(B) Federal Pandemic Unemployment Compensation and
Mixed Earner Unemployment Compensation under section
2104(b)(1) of the CARES Act (15 U.S.C. 9023(b)(1)); and
(C) pandemic emergency unemployment compensation
under section 2107(a)(2) of the CARES Act (15 U.S.C.
9025(a)(2)).
(2) Improper payment.--The term ``improper payment'' means
any amount of a pandemic unemployment payment to which the
individual is not entitled.
(3) State; state agency; state law.--The terms ``State'',
``State agency'', and ``State law'' have the meanings given
those terms in section 205 of the Federal-State Extended
Unemployment Compensation Act of 1970 (26 U.S.C. 3304 note).
SEC. 3. EXTENSION OF THE STATUTE OF LIMITATIONS FOR PANDEMIC
UNEMPLOYMENT FRAUD BY INDIVIDUALS UNDER CERTAIN
UNEMPLOYMENT PROGRAMS.
(a) Pandemic Unemployment Assistance.--Section 2102 of the CARES Act
(15 U.S.C. 9021) is amended--
(1) by redesignating subsection (h) as subsection (i); and
(2) by inserting after subsection (g) the following new
subsection:
``(h) Statute of Limitations.--
``(1) In general.--Notwithstanding any other provision of law
and subject to paragraph (2), any criminal prosecution or civil
enforcement action for a violation of, or conspiracy to
violate, section 371, 641, 1028A, 1029, 1341, 1343, 1344, 1349,
1956, or 1957 of title 18, United States Code, or section 3729
or 3802 of title 31, United States Code, with respect to any
unemployment compensation claim funded in whole or in part by
pandemic unemployment assistance under this section shall be
brought not later than 10 years after the date of the violation
or conspiracy.
``(2) Exception.--Paragraph (1) shall not apply with respect
to a criminal prosecution or civil enforcement action if the
statute of limitations applicable to such criminal prosecution
or civil enforcement action expired prior to the date of
enactment of the Recover COVID Unemployment Fraud in Banks
Act.''.
(b) Federal Pandemic Unemployment Compensation and Mixed Earner
Unemployment Compensation.--Section 2104(f) of the CARES Act (15 U.S.C.
9023(f)) is amended by adding at the end the following new paragraph:
``(5) Statute of limitations.--
``(A) In general.--Notwithstanding any other
provision of law and subject to subparagraph (B), any
criminal prosecution or civil enforcement action for a
violation of, or conspiracy to violate, section 371,
641, 1028A, 1029, 1341, 1343, 1344, 1349, 1956, or 1957
of title 18, United States Code, or section 3729 or
3802 of title 31, United States Code, with respect to
any unemployment compensation claim funded in whole or
in part by Federal Pandemic Unemployment Compensation
or Mixed Earner Unemployment Compensation under this
section shall be brought not later than 10 years after
the date of the violation or conspiracy.
``(B) Exception.--Subparagraph (A) shall not apply
with respect to a criminal prosecution or civil
enforcement action if the statute of limitations
applicable to such criminal prosecution or civil
enforcement action expired prior to the date of
enactment of the Recover COVID Unemployment Fraud in
Banks Act.''.
(c) Pandemic Emergency Unemployment Compensation.--Section 2107(e) of
the CARES Act (15 U.S.C. 9025(e)) is amended by adding at the end the
following new paragraph:
``(5) Statute of limitations.--
``(A) In general.--Notwithstanding any other
provision of law and subject to subparagraph (B), any
criminal prosecution or civil enforcement action for a
violation of, or conspiracy to violate, section 371,
641, 1028A, 1029, 1341, 1343, 1344, 1349, 1956, or 1957
of title 18, United States Code, or section 3729 or
3802 of title 31, United States Code, with respect to
any unemployment compensation claim funded in whole or
in part by Pandemic Emergency Unemployment Compensation
under this section shall be brought not later than 10
years after the date of the violation or conspiracy.
``(B) Exception.--Subparagraph (A) shall not apply
with respect to a criminal prosecution or civil
enforcement action if the statute of limitations
applicable to such criminal prosecution or civil
enforcement action expired prior to the date of
enactment of the Recover COVID Unemployment Fraud in
Banks Act.''.
(d) Effective Date.--The amendments made by section Act shall take
effect on the date of enactment of this Act.
I. SUMMARY AND BACKGROUND
A. Purpose and Summary
H.R. 8873, the ``Recover COVID Unemployment Fraud in Banks
Act,'' as ordered reported by the Committee on Ways and Means
on May 21, 2026, establishes a federal taskforce, led by a
National Recovery Coordinator, to coordinate with applicable
state agencies to reconcile unspent federal pandemic
unemployment insurance (UI) payments issued on prepaid debit
cards held by banks and develop model processes that facilitate
the cost-effective recovery of payments and return them to the
federal government. The bill includes due process protections
and information for UI claimants found to have had their
identity stolen connected to fraudulent payments, requires the
issuance of guidance to financial institutions that provides a
legal pathway to return payments to the appropriate state
agency, and mandates the creation of guidance to states
agencies responsible for unclaimed property on the obligations
of their agencies to review and return payments to the federal
government.
The bill also establishes a 10-year statute of limitations
for criminal prosecution and civil enforcement actions related
to fraudulent unemployment claims funded by federal pandemic
unemployment programs created in the Coronavirus Aid, Relief,
and Economic Security (CARES) Act (P.L. 116-136). These
programs include Pandemic Unemployment Assistance (PUA),
Federal Pandemic Unemployment Compensation (FPUC), Mixed Earner
Unemployment Compensation (MEUC), and Pandemic Emergency
Unemployment Compensation (PEUC). The bill doubles the statute
of limitations, which started to expire on March 27, 2025, from
five to 10 years, allowing federal law enforcement to continue
prosecuting criminals, recover billions in taxpayer dollars
lost to fraud during the COVID-19 pandemic and prevent the
continued escheatment of frozen UI payments on prepaid debit
cards to state unclaimed property administrators.
B. Background and Need for Legislation
On March 27, 2020, the CARES Act was signed into law in
response to the COVID-19 pandemic. The law included
authorization for several new, temporary federal pandemic
unemployment programs to: (1) provide supplemental payments (an
additional $600/week and subsequently $300/week) on top of
state regular UI payments; (2) cover self-employed and gig
workers not eligible for state UI; and (3) extend the number of
weeks unemployed workers could receive benefits. Like other
pandemic-era programs, such as the Paycheck Protection Program
(PPP), fraud was rampant in pandemic unemployment programs.
Generous benefits and high demand for immediate relief
overwhelmed state workforce agencies and allowed both domestic
and international fraudsters access to benefits, largely
through use of stolen personally identifiable information
(PII). Fraud delayed legitimate payments getting to workers and
resulted in an estimated $100-$135 billion in stolen
unemployment.\1\ According to the most recent data from the
Department of Labor, only $6 billion, or roughly four percent,
has been recovered.\2\
---------------------------------------------------------------------------
\1\Government Accountability Office (GAO-23-106696). ``Unemployment
Insurance. Estimated Amount of Fraud during Pandemic Likely Between
$100 Billion and $135 Billion,'' September 12, 2023.
\2\U.S. Department of Labor Employment and Training Administration.
UI Recovery Rates Report, https://oui.doleta.gov/unemploy/recovery/
recovery_rpt.asp.
---------------------------------------------------------------------------
During the pandemic, many states distributed millions in
pandemic unemployment benefits through prepaid debit cards
issued by banks. Banks are subject to federal laws that require
them to flag and report suspicious fraudulent activity. In some
cases, banks flagged debit card accounts containing
unemployment benefits for signs of fraud and froze the funds,
preventing them from being issued.
On January 30, 2026, and February 10, 2026, the Department
of Labor Inspector General (DOL-OIG) published two fraud alert
memos addressed to the Department of Labor (DOL) Employment and
Training Administration (ETA) describing the findings from
subpoenas to several financial institutions and concluded there
is a ``significant risk of loss of taxpayer funds.'' DOL-OIG's
investigation found that thousands of prepaid debit cards have
been left abandoned by state workforce agencies, unreconciled,
and in some cases transferred to state unclaimed property
divisions. DOL-OIG found that $720 million in UI benefits are
sitting on prepaid debit cards in banks, while another $192
million has already been escheated to state unclaimed property
divisions due to inactivity. Escheatment is the legal process
where financial institutions transfer ``abandoned'' or
unclaimed property, such as dormant bank accounts, uncashed
checks, or securities, to the state when the owner cannot be
located. The state acts as the custodian, holding these assets
indefinitely for the rightful owner to claim. Accounts are
typically considered abandoned after a period of inactivity
(often 3-5 years) and after failed attempts to contact the
owner.
DOL-OIG urged swift action and recommended that ETA issue
guidance to state workforce agencies within 30 days to ensure
relevant parties commence engagement to assess their findings
and take action to recover the funds. DOL-OIG's press release
stated, ``. . . without immediate action, American taxpayers
could lose $912 million tied to pandemic unemployment insurance
fraud.''\3\
---------------------------------------------------------------------------
\3\Press release: ``U.S. Department of Labor's Inspector General
Uncovers Nearly $1 Billion in Taxpayer Money at Risk--Tied to COVID
Unemployment Fraud,'' February 11, 2026.
---------------------------------------------------------------------------
DOL-OIG examined over $1.3 billion in affected UI funds
held on more than 6.5 million prepaid card accounts issued by
Financial Institutions 1 (FI1) and 2 (FI2). In total, across
both financial institutions, DOL-OIG found:
$1 billion remained on 5,902,117 prepaid
card accounts; and
$267 million in already escheated UI funds
from 915,495 prepaid card accounts.
Of these totals, DOL-OIG identified $912 million in
potentially fraudulently obtained funds that was, or is,
currently being held on 3,912,746 accounts.
$720 million (69% of the $1.04 billion) in
potentially fraudulently obtained funds was being held
on 3,453,080 FI1 and FI2 prepaid cards.
$192 million (72% of the $267 million) in
potentially fraudulently obtained FI1 and FI2 funds
that have been escheated to state unclaimed property.
Summary of DOL-OIG Findings of Pandemic Unemployment Funds in Banks
----------------------------------------------------------------------------------------------------------------
Financial Financial
Institution #1 Institution #2 Total
----------------------------------------------------------------------------------------------------------------
Potential Fraudulent Funds Held by Bank................ $523 million $197 million $720 million
# of Debit Cards................................... 2.7 million 774,000 3.4 million
Highest Amount on a Single Card.................... $76,000 $56,000 .................
Already Transferred to State Unclaimed Property........ $191 million $48,059 $192 million
Total Possible Funds to be Recovered................... ................. ................. $912 million
----------------------------------------------------------------------------------------------------------------
NOTE: Labor Department Inspector General assessed the state versus federal share of UI funding held by banks as
78% federal and 22% state unemployment funds.
Even more concerning, when reviewing debit card accounts
held by FI1 and FI2, DOL-OIG found $472 million, or nearly half
of the funds, were associated with claims that DOL-OIG had
previously flagged for DOL and state workforce agencies as
being potentially fraudulent in September 2022.\4\ In that
alert transmittal, DOL-OIG identified claims in states in four
specific high-risk areas, including payments to individuals
with Social Security numbers: (1) filed in multiple states, (2)
of deceased persons, (3) used to file UI claims with suspicious
email accounts, and (4) of federal prisoners.
---------------------------------------------------------------------------
\4\Alert Memorandum: Potentially Fraudulent Unemployment Insurance
Payments in High-Risk Areas Increased to $45.6 Billion, Report No. 19-
22-005-03-315 (September 21, 2022), https://www.oig.dol.gov/public/
reports/oa/2022/19-22-005-03-315.pdf, Department of Labor, Office of
Inspector General.
---------------------------------------------------------------------------
These recent findings indicate that many states took no
action regarding these prior flags, thus the millions of
dollars on ``forgotten'' debit cards still held by banks, and
unresolved by states. Recovering overpayments is a legally
required part of the UI program. However, states lack incentive
to resolve COVID-era claims largely because the majority of the
funds distributed during that time were federal (approximately
78%). Therefore, any time or staff associated with reviewing
claims for suspicious activity would need to be absorbed by the
state--but any dollars recovered go back to federal Treasury.
Following the pandemic, states were eager to ``move on'' and
lacked the staff to investigate the large volume of past claims
that were deemed fraudulent or suspicious, as evidenced by the
recent DOL-OIG findings.
Inaction means that unresolved taxpayer funds get turned
over to state unclaimed property divisions, essentially
abandoning millions in federal funds to state coffers. During a
hearing held by the Subcommittee on Work and Welfare on March
5, 2026, ``Reclaiming ``Forgotten'' Fraudulent Pandemic
Unemployment Funds Frozen by Banks,'' DOL-OIG Anthony
D'Esposito stated that nearly $1 billion in fraudulent
unemployment benefits remain unclaimed or frozen in prepaid
debit card accounts across 21 states and that more than $200
million of funds flagged for fraud have already been
transferred to state unclaimed property divisions. Furthermore,
the DOL-OIG estimated a total of $500 million will be escheated
by late summer or early fall if no action is taken by
Congress.\5\ However, absent new authority, DOL cannot compel
states to act. In addition, banks have cited challenges with
concerns about liability and lack of a clear pathway from the
federal government for safely returning funds to states.
---------------------------------------------------------------------------
\5\Email from DOL-OIG to Ways and Means Committee Majority Staff,
dated May 11, 2026.
---------------------------------------------------------------------------
Following the pandemic, some states were able to work
proactively with banks to recover funds. These states went
through the process to reconcile prepaid debit accounts of
claimants that were flagged for fraud by banks to recover what
state and federal funds they could. For example, in Ohio and
Maryland, funds were identified in banks and returned through
action on the part of the state and mutual cooperation. During
a Work and Welfare Subcommittee in February 6, 2025, Time's
Running Out: Prosecuting Fraudsters for Stealing Billions in
Unemployment Benefits from American Workers, one of our
witnesses testified to the recovery of nearly $400 million by
the Ohio Department of Job and Family Services from multiple
financial institutions.\6\ Last August, DOL-OIG working with
ETA, and the Maryland Department of Labor, facilitated the
return of approximately $520 million in suspected fraudulent
pandemic unemployment payments on bank debit cards to the
federal Treasury, which had been frozen by Bank of America.\7\
Despite these state successes, the recent DOL-OIG reports
indicate that much more work is left to be done and federal
action may be required to ensure funds are fully recovered.
---------------------------------------------------------------------------
\6\Hearing: ``Time's Running Out: Prosecuting Fraudsters for
Stealing Billions in Unemployment Benefits from American Workers,''
February 6, 2025, Subcommittee on Work and Welfare, Committee on Ways
and Means.
\7\Press release: ``U.S. Department of Labor Helps recover $520
million in suspected fraudulent pandemic-era unemployment insurance
payments,'' August 14, 2025.
---------------------------------------------------------------------------
H.R. 8873 is responsive to law enforcement agencies and
financial institutions' desire to have Congressional action to
address this urgent situation. By establishing a federal task
force, led by a National Recovery Coordinator, to coordinate
with applicable state workforce agencies to identify federal
pandemic UI payments issued on prepaid debit cards held by
financial institutions or transferred to state agencies
responsible for unclaimed property and providing a legal
pathway for financial institutions to return payments to state
agencies is decisive action needed to craw these funds back and
safeguard taxpayer's money.
H.R. 8873 also includes an extension of the statute of
limitations for prosecuting criminal and civil enforcement
actions involving pandemic unemployment fraud. Section 3 of the
bill is the same language included in H.R. 1156, which passed
the House as a standalone bill on March 11, 2025. Since then,
the Congressional Budget Office (CBO) revised their score of
that bill, which originally attributed a cost of $10 million/10
years, to savings of $10 million/10 years attributable to a
reduction in direct spending as a result of additional federal
recoveries of fraudulent payments.\8\ (Also see the Committee's
report with further explanation and background for changes
included in H.R. 1163.)
---------------------------------------------------------------------------
\8\Email from CBO to House and Senate Majority and Minority
Committee staff dated March 6, 2026.
---------------------------------------------------------------------------
C. Legislative History
Background
H.R. 8873 was introduced on May 19, 2026, and was referred
to the Committee on Ways and Means.
Committee Hearings
The Committee has held the following hearings:
On March 5, 2026, the Committee on Ways and Means
Subcommittee on Work and Welfare held a hearing titled
``Reclaiming ``Forgotten'' Fraudulent Pandemic Unemployment
Funds Frozen by Banks.''
Committee Action
The Committee on Ways and Means marked up H.R. 8873,
``Recover COVID Unemployment Fraud in Banks Act,'' on May 21,
2026, and ordered the bill, as amended, favorably reported
(with a quorum being present).
D. Designated Hearing
Pursuant to clause 3(c)(6) of rule XIII, the following
hearing was used to develop and consider: ``Reclaiming
``Forgotten'' Fraudulent Pandemic Unemployment Funds Frozen by
Banks,'' hearing held on March 5, 2026.
II. EXPLANATION OF THE BILL
A. Reasons for Change
Section 1. The Committee believes the title accurately
reflects the content of the bill.
Section 2. The Committee believes establishing a federal
taskforce, led by a National Recovery Coordinator, to
coordinate with states to review and recover federal pandemic
UI payments issued on prepaid debit cards banks or already
transferred to state unclaimed property managers will result in
additionally recovery of stolen UI funds to the American
taxpayer.
Section 3. The Committee believes extending the statute of
limitations for criminal prosecution and civil enforcement
actions in pandemic unemployment programs from 5 to 10 years
will give federal law enforcement officials the tools to hold
criminals who perpetrated pandemic fraud accountable and lead
to additional recovery of taxpayer dollars.
B. Explanation of Provisions
Section 1. This section provides the short title, Recover
COVID Unemployment Fraud in Banks Act.
Section 2. Requires establishment of a federal taskforce
within 30 days of enactment, to be named the ``Recover Pandemic
Unemployment Funds in Banks Task Force,'' led by a National
Recovery Coordinator.
Establishes members of the task force to include: the
Attorney General, Secretary of Labor, Inspector General of the
Department of Labor, Secretary of the Treasury, Chairman of the
Federal Deposit Insurance Corporation, and Director of the
Consumer Financial Protection Bureau.
Outlines task force responsibilities to include:
Coordinating with state agencies to identify
federal pandemic unemployment compensation payments
issued on prepaid debit cards held by financial
institutions or transferred to state agencies
responsible for unclaimed property;
Coordinating with appropriate federal
agencies to develop model processes that result in
cost-effective recovery of such payments, including
issuing guidance to state agencies with guidance
pertaining to:
reviewing payments and
determining whether a payment was an improper
payment; determining cost effective recovery
thresholds;
actions to be taken by the state
if an improper payment is determined to be the
result of fraud;
model notice and information
about resources available to individuals whose
identity information is determined to have been
fraudulently used;
information on legal pathways
for recovery of improper payments held by
financial institutions; and
procedural requirements for
returning funds to the federal government.
Issuing guidance to financial institutions
holding such payments, providing them with a legal
pathway to return payments to the appropriate state
agency;
Issuing guidance to administrators of state
agencies responsible for unclaimed property on the
obligations of their agencies to review and return
payments to the appropriate state agency.
Requires the task force to consult with state agencies and
incorporate best practices from previous attempts by state
agencies to recover payments determined to be improper payments
from financial institutions.
Provides that the Secretary of Labor shall reimburse states
for administrative costs incurred as a result of coordination
with the task force.
Provides definitions of ``federal pandemic unemployment
compensation'' to include pandemic unemployment programs funded
by the CARES Act (P.L. 116-136); ``improper payments;'' and
``state agency''.
Section 3. Establishes a 10-year statute of limitations,
based on the date of the violation, for criminal prosecution
and civil enforcement actions related to fraudulent
unemployment claims funded in or whole in part by the following
CARES Act programs: Pandemic Unemployment Assistance; Federal
Pandemic Unemployment Compensation and Mixed Earner
Unemployment Compensation; and Pandemic Emergency Unemployment
Compensation.
Provides an exception with respect to criminal prosecution
or civil enforcement if the statute of limitations applicable
to such criminal prosecution or civil enforcement expired prior
to the date of enactment.
C. Effective Date
This bill would become effective upon enactment.
III. VOTE OF THE COMMITTEE
In compliance with the Rules of the House of
Representatives, the following statement is made concerning the
vote of the Committee on Ways and Means during the markup
consideration of H.R. 8873, the ``Recover COVID Unemployment
Fraud in Banks Act,'' on May 21, 2026.
H.R. 8873 was ordered favorably reported to the House of
Representatives as amended by a roll call vote of 41 yeas to 0
nays (with a quorum being present). The vote was as follows:
----------------------------------------------------------------------------------------------------------------
Representative Yea Nay Present Representative Yea Nay Present
----------------------------------------------------------------------------------------------------------------
Mr. Smith (MO)................ X ......... ......... Mr. Neal........ X ......... .........
Mr. Buchanan.................. ........ ......... ......... Mr. Doggett..... X ......... .........
Mr. Smith (NE)................ X ......... ......... Mr. Thompson.... X ......... .........
Mr. Kelly..................... X ......... ......... Mr. Larson...... X ......... .........
Mr. Schweikert................ X ......... ......... Mr. Davis....... X ......... .........
Mr. LaHood.................... X ......... ......... Ms. Sanchez..... X ......... .........
Mr. Arrington................. X ......... ......... Ms. Sewell...... X ......... .........
Mr. Estes..................... X ......... ......... Ms. DelBene..... X ......... .........
Mr. Smucker................... X ......... ......... Ms. Chu......... X ......... .........
Mr. Hern...................... X ......... ......... Ms. Moore (WI).. X ......... .........
Mrs. Miller (WV).............. ........ ......... ......... Mr. Boyle....... X ......... .........
Dr. Murphy.................... X ......... ......... Mr. Beyer....... X ......... .........
Mr. Kustoff................... X ......... ......... Mr. Evans....... X ......... .........
Mr. Fitzpatrick............... X ......... ......... Mr. Schneider... X ......... .........
Mr. Steube.................... ........ ......... ......... Mr. Panetta..... X ......... .........
Ms. Tenney.................... X ......... ......... Mr. Gomez....... X ......... .........
Mrs. Fischbach................ X ......... ......... Mr. Horsford.... X ......... .........
Mr. Moore (UT)................ X ......... ......... Ms. Plaskett.... X ......... .........
Ms. Van Duyne................. X ......... ......... Mr. Suozzi...... X ......... .........
Mr. Feenstra.................. X ......... .........
Ms. Malliotakis............... ........ ......... .........
Mr. Carey..................... X ......... .........
Mr. Yakym..................... X ......... .........
Mr. Miller (OH)............... X ......... .........
Mr. Bean...................... X ......... .........
Mr. Moran..................... X ......... .........
----------------------------------------------------------------------------------------------------------------
IV. BUDGET EFFECTS OF THE BILL
A. Committee Estimate of Budgetary Effects
With respect to clause 3(d) of rule XIII of the Rules of
the House of Representatives, a cost estimate provided by the
Congressional Budget Office pursuant to section 402 of the
Congressional Budget Act of 1974 was not made available to the
Committee in time for the filing of this report.
B. Statement Regarding New Budget Authority and Tax Expenditures Budget
Authority
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee states that the
bill involves no new or increased budget authority. The
Committee states further that the bill involves no new or
increased tax expenditures.
C. Cost Estimate Prepared by the Congressional
Budget Office
With respect to the requirements of clause 3(c)(2) of rule
XIII of the Rules of the House of Representatives and section
308(a) of the Congressional Budget Act of 1974 and with respect
to requirements of clause (3)(c)(3) of rule XIII of the Rules
of the House of Representatives and section 402 of the
Congressional Budget Act of 1974, the Committee has requested
but not received a cost estimate for this bill from the
Director of Congressional Budget Office. The Chairman of the
Committee shall cause such estimate and statement to be printed
in the Congressional Record upon its receipt by the Committee.
V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE
A. Committee Oversight Findings and Recommendations
With respect to clause 3(c)(1) of rule XIII of the Rules of
the House of Representatives, the Committee made findings and
recommendations that are reflected in this report.
B. Statement of General Performance Goals and Objectives
With respect to clause 3(c)(4) of rule XIII of the Rules of
the House of Representatives, the Committee advises that the
bill does not authorize funding, so no statement of general
performance goals and objectives is required.
C. Information Relating to Unfunded Mandates
This information is provided in accordance with section 423
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
The Committee has determined that the bill does not contain
Federal mandates on the private sector. The Committee has
determined that the bill does not impose a Federal
intergovernmental mandate on State, local, or tribal
governments.
D. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits
With respect to clause 9 of rule XXI of the Rules of the
House of Representatives, the Committee has carefully reviewed
the provisions of the bill, and states that the provisions of
the bill do not contain any congressional earmarks, limited tax
benefits, or limited tariff benefits within the meaning of the
rule.
E. Tax Complexity Analysis
Pursuant to clause 3(h)(1) of rule XIII of the Rules of the
House of Representatives, the staff of the Joint Committee on
Taxation has determined that a complexity analysis is not
required under section 4022(b) of the IRS Reform Act because
the bill contains no provisions that amend the Internal Revenue
Code of 1986 and that have ``widespread applicability'' to
individuals or small businesses, within the meaning of the
rule.
F. Duplication of Federal Programs
In compliance with clause 3(c)(5) of rule XIII of the Rules
of the House of Representatives, the Committee states that no
provision of the bill establishes or reauthorizes: (1) a
program of the Federal Government known to be duplicative of
another Federal program; (2) a program included in any report
from the Government Accountability Office to Congress pursuant
to section 21 of Public Law 111-139; or (3) a program related
to a program identified in the most recent Catalog of Federal
Domestic Assistance, published pursuant to the Federal Program
Information Act (Pub. L. No. 95-220, as amended by Pub. L. No.
98-169).
VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italics, and existing law in which no
change is proposed is shown in roman):
CARES ACT
* * * * * * *
DIVISION A--KEEPING WORKERS PAID AND EMPLOYED, HEALTH CARE SYSTEM
ENHANCEMENTS, AND ECONOMIC STABILIZATION
* * * * * * *
TITLE II--ASSISTANCE FOR AMERICAN WORKERS, FAMILIES, AND BUSINESSES
Subtitle A--Unemployment Insurance Provisions
* * * * * * *
SEC. 2102. PANDEMIC UNEMPLOYMENT ASSISTANCE.
(a) Definitions.--In this section:
(1) COVID-19.--The term ``COVID-19'' means the 2019
Novel Coronavirus or 2019-nCoV.
(2) COVID-19 public health emergency.--The term
``COVID-19 public health emergency'' means the public
health emergency declared by the Secretary of Health
and Human Services on January 27, 2020, with respect to
the 2019 Novel Coronavirus.
(3) Covered individual.--The term ``covered
individual''--
(A) means an individual who--
(i) is not eligible for regular
compensation or extended benefits under
State or Federal law or pandemic
emergency unemployment compensation
under section 2107, including an
individual who has exhausted all rights
to regular unemployment or extended
benefits under State or Federal law or
pandemic emergency unemployment
compensation under section 2107;
(ii) provides self-certification that
the individual--
(I) is otherwise able to work
and available for work within
the meaning of applicable State
law, except the individual is
unemployed, partially
unemployed, or unable or
unavailable to work because--
(aa) the individual
has been diagnosed with
COVID-19 or is
experiencing symptoms
of COVID-19 and seeking
a medical diagnosis;
(bb) a member of the
individual's household
has been diagnosed with
COVID-19;
(cc) the individual
is providing care for a
family member or a
member of the
individual's household
who has been diagnosed
with COVID-19;
(dd) a child or other
person in the household
for which the
individual has primary
caregiving
responsibility is
unable to attend school
or another facility
that is closed as a
direct result of the
COVID-19 public health
emergency and such
school or facility care
is required for the
individual to work;
(ee) the individual
is unable to reach the
place of employment
because of a quarantine
imposed as a direct
result of the COVID-19
public health
emergency;
(ff) the individual
is unable to reach the
place of employment
because the individual
has been advised by a
health care provider to
self-quarantine due to
concerns related to
COVID-19;
(gg) the individual
was scheduled to
commence employment and
does not have a job or
is unable to reach the
job as a direct result
of the COVID-19 public
health emergency;
(hh) the individual
has become the
breadwinner or major
support for a household
because the head of the
household has died as a
direct result of COVID-
19;
(ii) the individual
has to quit his or her
job as a direct result
of COVID-19;
(jj) the individual's
place of employment is
closed as a direct
result of the COVID-19
public health
emergency; or
(kk) the individual
meets any additional
criteria established by
the Secretary for
unemployment assistance
under this section; or
(II) is self-employed, is
seeking part-time employment,
does not have sufficient work
history, or otherwise would not
qualify for regular
unemployment or extended
benefits under State or Federal
law or pandemic emergency
unemployment compensation under
section 2107 and meets the
requirements of subclause (I);
and
(iii) provides documentation to
substantiate employment or self-
employment or the planned commencement
of employment or self-employment not
later than 21 days after the later of
the date on which the individual
submits an application for pandemic
unemployment assistance under this
section or the date on which an
individual is directed by the State
Agency to submit such documentation in
accordance with section 625.6(e) of
title 20, Code of Federal Regulations,
or any successor thereto, except that
such deadline may be extended if the
individual has shown good cause under
applicable State law for failing to
submit such documentation; and
(B) does not include--
(i) an individual who has the ability
to telework with pay; or
(ii) an individual who is receiving
paid sick leave or other paid leave
benefits, regardless of whether the
individual meets a qualification
described in items (aa) through (kk) of
subparagraph (A)(i)(I).
(4) Secretary.--The term ``Secretary'' means the
Secretary of Labor.
(5) State.--The term ``State'' includes the District
of Columbia, the Commonwealth of Puerto Rico, the
Virgin Islands, Guam, American Samoa, the Commonwealth
of the Northern Mariana Islands, the Federated States
of Micronesia, the Republic of the Marshall Islands,
and the Republic of Palau.
(b) Assistance for Unemployment as a Result of COVID-19.--
Subject to subsection (c), the Secretary shall provide to any
covered individual unemployment benefit assistance while such
individual is unemployed, partially unemployed, or unable to
work for the weeks of such unemployment with respect to which
the individual is not entitled to any other unemployment
compensation (as that term is defined in section 85(b) of title
26, United States Code) or waiting period credit.
(c) Applicability.--
(1) In general.--Except as provided in paragraph (2),
the assistance authorized under subsection (b) shall be
available to a covered individual--
(A) for weeks of unemployment, partial
unemployment, or inability to work caused by
COVID-19--
(i) beginning on or after January 27,
2020; and
(ii) ending on or before September 6,
2021; and
(B) subject to subparagraph (A)(ii), as long
as the covered individual's unemployment,
partial unemployment, or inability to work
caused by COVID-19 continues.
(2) Limitation on duration of assistance.--The total
number of weeks for which a covered individual may
receive assistance under this section shall not exceed
79 weeks and such total shall include any week for
which the covered individual received regular
compensation or extended benefits under any Federal or
State law, except that if after the date of enactment
of this Act, the duration of extended benefits is
extended, the 79-week period described in this
paragraph shall be extended by the number of weeks that
is equal to the number of weeks by which the extended
benefits were extended.
(3) Assistance for unemployment before date of
enactment.--The Secretary shall establish a process for
making assistance under this section available for
weeks beginning on or after January 27, 2020, and
before the date of enactment of this Act.
(5) Appeals by an individual.--
(A) In general.--An individual may appeal any
determination or redetermination regarding the
rights to pandemic unemployment assistance
under this section made by the State agency of
any of the States.
(B) Procedure.--All levels of appeal filed
under this paragraph in the 50 states, the
District of Columbia, the Commonwealth of
Puerto Rico, and the Virgin Islands--
(i) shall be carried out by the
applicable State that made the
determination or redetermination; and
(ii) shall be conducted in the same
manner and to the same extent as the
applicable State would conduct appeals
of determinations or redeterminations
regarding rights to regular
compensation under State law.
(C) Procedure for certain territories.--With
respect to any appeal filed in Guam, American
Samoa, the Commonwealth of the Northern Mariana
Islands, the Federated States of Micronesia,
Republic of the Marshall Islands, and the
Republic of Palau--
(i) lower level appeals shall be
carried out by the applicable entity
within the State;
(ii) if a higher level appeal is
allowed by the State, the higher level
appeal shall be carried out by the
applicability entity within the State;
and
(iii) appeals described in clauses
(i) and (ii) shall be conducted in the
same manner and to the same extent as
appeals of regular unemployment
compensation are conducted under the
unemployment compensation law of
Hawaii.
(6) Continued eligibility for assistance.--As a
condition of continued eligibility for assistance under
this section, a covered individual shall submit a
recertification to the State for each week after the
individual's 1st week of eligibility that certifies
that the individual remains an individual described in
subsection (a)(3)(A)(ii) for such week.
(d) Amount of Assistance.--
(1) In general.--The assistance authorized under
subsection (b) for a week of unemployment, partial
unemployment, or inability to work shall be--
(A)(i) the weekly benefit amount authorized
under the unemployment compensation law of the
State where the covered individual was
employed, except that the amount may not be
less than the minimum weekly benefit amount
described in section 625.6 of title 20, Code of
Federal Regulations, or any successor thereto;
and
(ii) the amount of Federal Pandemic
Unemployment Compensation under section 2104;
and
(B) in the case of an increase of the weekly
benefit amount after the date of enactment of
this Act, increased in an amount equal to such
increase.
(2) Calculations of amounts for certain covered
individuals.--In the case of a covered individual who
is self-employed, who lives in a territory described in
subsection (c) or (d) of section 625.6 of title 20,
Code of Federal Regulations, or who would not otherwise
qualify for unemployment compensation under State law,
the assistance authorized under subsection (b) for a
week of unemployment shall be calculated in accordance
with section 625.6 of title 20, Code of Federal
Regulations, or any successor thereto, and shall be
increased by the amount of Federal Pandemic
Unemployment Compensation under section 2104.
(3) Allowable methods of payment.--Any assistance
provided for in accordance with paragraph (1)(A)(ii)
shall be payable either--
(A) as an amount which is paid at the same
time and in the same manner as the assistance
provided for in paragraph (1)(A)(i) is payable
for the week involved; or
(B) at the option of the State, by payments
which are made separately from, but on the same
weekly basis as, any assistance provided for in
paragraph (1)(A)(i).
(4) Waiver authority.--In the case of individuals who
have received amounts of pandemic unemployment
assistance to which they were not entitled, the State
shall require such individuals to repay the amounts of
such pandemic unemployment assistance to the State
agency, except that the State agency may waive such
repayment if it determines that--
(A) the payment of such pandemic unemployment
assistance was without fault on the part of any
such individual; and
(B) such repayment would be contrary to
equity and good conscience.
(e) Waiver of State Requirement.--Notwithstanding State law,
for purposes of assistance authorized under this section,
compensation under this Act shall be made to an individual
otherwise eligible for such compensation without any waiting
period.
(f) Agreements With States.--
(1) In general.--The Secretary shall provide the
assistance authorized under subsection (b) through
agreements with States which, in the judgment of the
Secretary, have an adequate system for administering
such assistance through existing State agencies,
including procedures for identity verification or
validation and for timely payment, to the extent
reasonable and practicable.
(2) Payments to states.--There shall be paid to each
State which has entered into an agreement under this
subsection an amount equal to 100 percent of--
(A) the total amount of assistance provided
by the State pursuant to such agreement; and
(B) any additional administrative expenses
incurred by the State by reason of such
agreement (as determined by the Secretary),
including any administrative expenses necessary
to facilitate processing of applications for
assistance under this section online or by
telephone rather than in-person and expenses
related to identity verification or validation
and timely and accurate payment.
(3) Terms of payments.--Sums payable to any State by
reason of such State's having an agreement under this
subsection shall be payable, either in advance or by
way of reimbursement (as determined by the Secretary),
in such amounts as the Secretary estimates the State
will be entitled to receive under this subsection for
each calendar month, reduced or increased, as the case
may be, by any amount by which the Secretary finds that
his estimates for any prior calendar month were greater
or less than the amounts which should have been paid to
the State. Such estimates may be made on the basis of
such statistical, sampling, or other method as may be
agreed upon by the Secretary and the State agency of
the State involved.
(g) Funding.--
(1) Assistance.--
(A) In general.--Funds in the extended
unemployment compensation account (as
established by section 905(a) of the Social
Security Act (42 U.S.C. 1105(a)) of the
Unemployment Trust Fund (as established by
section 904(a) of such Act (42 U.S.C. 1104(a))
shall be used to make payments to States
pursuant to subsection (f)(2)(A).
(B) Transfer of funds.--Notwithstanding any
other provision of law, the Secretary of the
Treasury shall transfer from the general fund
of the Treasury (from funds not otherwise
appropriated) to the extended unemployment
compensation account such sums as the Secretary
of Labor estimates to be necessary to make
payments described in subparagraph (A). There
are appropriated from the general fund of the
Treasury, without fiscal year limitation, the
sums referred to in the preceding sentence and
such sums shall not be required to be repaid.
(2) Administrative expenses.--
(A) In general.--Funds in the employment
security administration account (as established
by section 901(a) of the Social Security Act
(42 U.S.C. 1105(a)) of the Unemployment Trust
Fund (as established by section 904(a) of such
Act (42 U.S.C. 1104(a)) shall be used to make
payments to States pursuant to subsection
(f)(2)(B).
(B) Transfer of funds.--Notwithstanding any
other provision of law, the Secretary of the
Treasury shall transfer from the general fund
of the Treasury (from funds not otherwise
appropriated) to the employment security
administration account such sums as the
Secretary of Labor estimates to be necessary to
make payments described in subparagraph (A).
There are appropriated from the general fund of
the Treasury, without fiscal year limitation,
the sums referred to in the preceding sentence
and such sums shall not be required to be
repaid.
(3) Certifications.--The Secretary of Labor shall
from time to time certify to the Secretary of the
Treasury for payment to each State the sums payable to
such State under paragraphs (1) and (2).
(h) Statute of Limitations.--
(1) In general.--Notwithstanding any other provision
of law and subject to paragraph (2), any criminal
prosecution or civil enforcement action for a violation
of, or conspiracy to violate, section 371, 641, 1028A,
1029, 1341, 1343, 1344, 1349, 1956, or 1957 of title
18, United States Code, or section 3729 or 3802 of
title 31, United States Code, with respect to any
unemployment compensation claim funded in whole or in
part by pandemic unemployment assistance under this
section shall be brought not later than 10 years after
the date of the violation or conspiracy.
(2) Exception.--Paragraph (1) shall not apply with
respect to a criminal prosecution or civil enforcement
action if the statute of limitations applicable to such
criminal prosecution or civil enforcement action
expired prior to the date of enactment of the Recover
COVID Unemployment Fraud in Banks Act.
[(h)] (i) Relationship Between Pandemic Unemployment
Assistance and Disaster Unemployment Assistance.--Except as
otherwise provided in this section or to the extent there is a
conflict between this section and part 625 of title 20, Code of
Federal Regulations, such part 625 shall apply to this section
as if--
(1) the term ``COVID-19 public health emergency''
were substituted for the term ``major disaster'' each
place it appears in such part 625; and
(2) the term ``pandemic'' were substituted for the
term ``disaster'' each place it appears in such part
625.
* * * * * * *
SEC. 2104. EMERGENCY INCREASE IN UNEMPLOYMENT COMPENSATION BENEFITS.
(a) Federal-State Agreements.--Any State which desires to do
so may enter into and participate in an agreement under this
section with the Secretary of Labor (in this section referred
to as the ``Secretary''). Any State which is a party to an
agreement under this section may, upon providing 30 days'
written notice to the Secretary, terminate such agreement.
(b) Provisions of Agreement.--
(1) Federal pandemic unemployment compensation.--Any
agreement under this section shall provide that the
State agency of the State will make payments of regular
compensation to individuals in amounts and to the
extent that they would be determined if the State law
of the State were applied, with respect to any week for
which the individual is (disregarding this section)
otherwise entitled under the State law to receive
regular compensation, as if such State law had been
modified in a manner such that the amount of regular
compensation (including dependents' allowances) payable
for any week shall be equal to--
(A) the amount determined under the State law
(before the application of this paragraph),
plus
(B) an additional amount equal to the amount
specified in paragraph (3) (in this section
referred to as ``Federal Pandemic Unemployment
Compensation''), plus
(C) an additional amount of $100 (in this
section referred to as ``Mixed Earner
Unemployment Compensation'') in any case in
which the individual received at least $5,000
of self-employment income (as defined in
section 1402(b) of the Internal Revenue Code of
1986) in the most recent taxable year ending
prior to the individual's application for
regular compensation.
(2) Allowable methods of payment.--Any Federal
Pandemic Unemployment Compensation or Mixed Earner
Unemployment Compensation provided for in accordance
with paragraph (1) shall be payable either--
(A) as an amount which is paid at the same
time and in the same manner as any regular
compensation otherwise payable for the week
involved; or
(B) at the option of the State, by payments
which are made separately from, but on the same
weekly basis as, any regular compensation
otherwise payable.
(3) Amount of federal pandemic unemployment
compensation.--
(A) In general.--The amount specified in this
paragraph is the following amount:
(i) For weeks of unemployment
beginning after the date on which an
agreement is entered into under this
section and ending on or before July
31, 2020, $600.
(ii) For weeks of unemployment
beginning after December 26, 2020 (or,
if later, the date on which such
agreement is entered into), and ending
on or before September 6, 2021, $300.
(4) Certain documentation required.--An agreement
under this section shall include a requirement, similar
to the requirement under section 2102(a)(3)(A)(iii),
for the substantiation of self-employment income with
respect to each applicant for Mixed Earner Unemployment
Compensation under paragraph (1)(C).
(c) Nonreduction Rule.--
(1) In general.--An agreement under this section
shall not apply (or shall cease to apply) with respect
to a State upon a determination by the Secretary that
the method governing the computation of regular
compensation under the State law of that State has been
modified in a manner such that the number of weeks (the
maximum benefit entitlement), or the average weekly
benefit amount, of regular compensation which will be
payable during the period of the agreement (determined
disregarding any Federal Pandemic Unemployment
Compensation or Mixed Earner Unemployment Compensation)
will be less than the number of weeks, or the average
weekly benefit amount, of the average weekly benefit
amount of regular compensation which would otherwise
have been payable during such period under the State
law, as in effect on January 1, 2020.
(2) Maximum benefit entitlement.--In paragraph (1),
the term ``maximum benefit entitlement'' means the
amount of regular unemployment compensation payable to
an individual with respect to the individual's benefit
year.
(d) Payments to States.--
(1) In general.--
(A) Full reimbursement.--There shall be paid
to each State which has entered into an
agreement under this section an amount equal to
100 percent of--
(i) the total amount of Federal
Pandemic Unemployment Compensation and
Mixed Earner Unemployment Compensation
paid to individuals by the State
pursuant to such agreement; and
(ii) any additional administrative
expenses incurred by the State by
reason of such agreement (as determined
by the Secretary).
(B) Terms of payments.--Sums payable to any
State by reason of such State's having an
agreement under this section shall be payable,
either in advance or by way of reimbursement
(as determined by the Secretary), in such
amounts as the Secretary estimates the State
will be entitled to receive under this section
for each calendar month, reduced or increased,
as the case may be, by any amount by which the
Secretary finds that his estimates for any
prior calendar month were greater or less than
the amounts which should have been paid to the
State. Such estimates may be made on the basis
of such statistical, sampling, or other method
as may be agreed upon by the Secretary and the
State agency of the State involved.
(2) Certifications.--The Secretary shall from time to
time certify to the Secretary of the Treasury for
payment to each State the sums payable to such State
under this section.
(3) Appropriation.--There are appropriated from the
general fund of the Treasury, without fiscal year
limitation, such sums as may be necessary for purposes
of this subsection.
(e) Applicability.--An agreement entered into under this
section shall apply--
(1) to weeks of unemployment beginning after the date
on which such agreement is entered into and ending on
or before July 31, 2020; and
(2) to weeks of unemployment beginning after December
26, 2020 (or, if later, the date on which such
agreement is entered into), and ending on or before
September 6, 2021.
(f) Fraud and Overpayments.--
(1) In general.--If an individual knowingly has made,
or caused to be made by another, a false statement or
representation of a material fact, or knowingly has
failed, or caused another to fail, to disclose a
material fact, and as a result of such false statement
or representation or of such nondisclosure such
individual has received an amount of Federal Pandemic
Unemployment Compensation or Mixed Earner Unemployment
Compensation to which such individual was not entitled,
such individual--
(A) shall be ineligible for further Federal
Pandemic Unemployment Compensation or Mixed
Earner Unemployment Compensation in accordance
with the provisions of the applicable State
unemployment compensation law relating to fraud
in connection with a claim for unemployment
compensation; and
(B) shall be subject to prosecution under
section 1001 of title 18, United States Code.
(2) Repayment.--In the case of individuals who have
received amounts of Federal Pandemic Unemployment
Compensation or Mixed Earner Unemployment Compensation
to which they were not entitled, the State shall
require such individuals to repay the amounts of such
Federal Pandemic Unemployment Compensation or Mixed
Earner Unemployment Compensation to the State agency,
except that the State agency may waive such repayment
if it determines that--
(A) the payment of such Federal Pandemic
Unemployment Compensation or Mixed Earner
Unemployment Compensation was without fault on
the part of any such individual; and
(B) such repayment would be contrary to
equity and good conscience.
(3) Recovery by state agency.--
(A) In general.--The State agency shall
recover the amount to be repaid, or any part
thereof, by deductions from any Federal
Pandemic Unemployment Compensation or Mixed
Earner Unemployment Compensation payable to
such individual or from any unemployment
compensation payable to such individual under
any State or Federal unemployment compensation
law administered by the State agency or under
any other State or Federal law administered by
the State agency which provides for the payment
of any assistance or allowance with respect to
any week of unemployment, during the 3-year
period after the date such individuals received
the payment of the Federal Pandemic
Unemployment Compensation or Mixed Earner
Unemployment Compensation to which they were
not entitled, in accordance with the same
procedures as apply to the recovery of
overpayments of regular unemployment benefits
paid by the State.
(B) Opportunity for hearing.--No repayment
shall be required, and no deduction shall be
made, until a determination has been made,
notice thereof and an opportunity for a fair
hearing has been given to the individual, and
the determination has become final.
(4) Review.--Any determination by a State agency
under this section shall be subject to review in the
same manner and to the same extent as determinations
under the State unemployment compensation law, and only
in that manner and to that extent.
(5) Statute of limitations.--
(A) In general.--Notwithstanding any other
provision of law and subject to subparagraph
(B), any criminal prosecution or civil
enforcement action for a violation of, or
conspiracy to violate, section 371, 641, 1028A,
1029, 1341, 1343, 1344, 1349, 1956, or 1957 of
title 18, United States Code, or section 3729
or 3802 of title 31, United States Code, with
respect to any unemployment compensation claim
funded in whole or in part by Federal Pandemic
Unemployment Compensation or Mixed Earner
Unemployment Compensation under this section
shall be brought not later than 10 years after
the date of the violation or conspiracy.
(B) Exception.--Subparagraph (A) shall not
apply with respect to a criminal prosecution or
civil enforcement action if the statute of
limitations applicable to such criminal
prosecution or civil enforcement action expired
prior to the date of enactment of the Recover
COVID Unemployment Fraud in Banks Act.
(g) Application to Other Unemployment Benefits.--Each
agreement under this section shall include provisions to
provide that--
(1) the purposes of the preceding provisions of this
section, as such provisions apply with respect to
Federal Pandemic Unemployment Compensation, shall be
applied with respect to unemployment benefits described
in subsection (i)(2) to the same extent and in the same
manner as if those benefits were regular compensation;
and
(2) the purposes of the preceding provisions of this
section, as such provisions apply with respect to Mixed
Earner Unemployment Compensation, shall be applied with
respect to unemployment benefits described in
subparagraph (A), (B), (D), or (E) of subsection (i)(2)
to the same extent and in the same manner as if those
benefits were regular compensation.
(h) Disregard of Additional Compensation for Purposes of
Medicaid and CHIP.--The monthly equivalent of any Federal
pandemic unemployment compensation paid to an individual under
this section shall be disregarded when determining income for
any purpose under the programs established under titles XIX and
title XXI of the Social Security Act (42 U.S.C. 1396 et seq.,
1397aa et seq.).
(i) Definitions.--For purposes of this section--
(1) the terms ``compensation'', ``regular
compensation'', ``benefit year'', ``State'', ``State
agency'', ``State law'', and ``week'' have the
respective meanings given such terms under section 205
of the Federal-State Extended Unemployment Compensation
Act of 1970 (26 U.S.C. 3304 note); and
(2) any reference to unemployment benefits described
in this paragraph shall be considered to refer to--
(A) extended compensation (as defined by
section 205 of the Federal-State Extended
Unemployment Compensation Act of 1970);
(B) regular compensation (as defined by
section 85(b) of the Internal Revenue Code of
1986) provided under any program administered
by a State under an agreement with the
Secretary;
(C) pandemic unemployment assistance under
section 2102;
(D) pandemic emergency unemployment
compensation under section 2107; and
(E) short-time compensation under a short-
time compensation program (as defined in
section 3306(v) of the Internal Revenue Code of
1986).
* * * * * * *
SEC. 2107. PANDEMIC EMERGENCY UNEMPLOYMENT COMPENSATION.
(a) Federal-State Agreements.--
(1) In general.--Any State which desires to do so may
enter into and participate in an agreement under this
section with the Secretary of Labor (in this section
referred to as the ``Secretary''). Any State which is a
party to an agreement under this section may, upon
providing 30 days' written notice to the Secretary,
terminate such agreement.
(2) Provisions of agreement.--Any agreement under
paragraph (1) shall provide that the State agency of
the State will make payments of pandemic emergency
unemployment compensation to individuals who--
(A) have exhausted all rights to regular
compensation under the State law or under
Federal law with respect to a benefit year
(excluding any benefit year that ended before
July1, 2019);
(B) have no rights to regular compensation
with respect to a week under such law or any
other State unemployment compensation law or to
compensation under any other Federal law;
(C) are not receiving compensation with
respect to such week under the unemployment
compensation law of Canada; and
(D) are able to work, available to work, and
actively seeking work.
(3) Exhaustion of benefits.--For purposes of
paragraph (2)(A), an individual shall be deemed to have
exhausted such individual's rights to regular
compensation under a State law when--
(A) no payments of regular compensation can
be made under such law because such individual
has received all regular compensation available
to such individual based on employment or wages
during such individual's base period; or
(B) such individual's rights to such
compensation have been terminated by reason of
the expiration of the benefit year with respect
to which such rights existed.
(4) Weekly benefit amount, etc.--For purposes of any
agreement under this section--
(A) the amount of pandemic emergency
unemployment compensation which shall be
payable to any individual for any week of total
unemployment shall be equal to--
(i) the amount of the regular
compensation (including dependents'
allowances) payable to such individual
during such individual's benefit year
under the State law for a week of total
unemployment;
(ii) the amount of Federal Pandemic
Unemployment Compensation under section
2104(b)(1)(B); and
(iii) the amount (if any) of Mixed
Earner Unemployment Compensation under
section 2104(b)(1)(C);
(B) the terms and conditions of the State law
which apply to claims for regular compensation
and to the payment thereof (including terms and
conditions relating to availability for work,
active search for work, and refusal to accept
work) shall apply to claims for pandemic
emergency unemployment compensation and the
payment thereof, except where otherwise
inconsistent with the provisions of this
section or with the regulations or operating
instructions of the Secretary promulgated to
carry out this section;
(C) the maximum amount of pandemic emergency
unemployment compensation payable to any
individual for whom an pandemic emergency
unemployment compensation account is
established under subsection (b) shall not
exceed the amount established in such account
for such individual; and
(D) the allowable methods of payment under
section 2104(b)(2) shall apply to payments of
amounts described in subparagraph (A)(ii).
(5) Coordination rules.--
(A) In general.--Subject to subparagraph (B),
an agreement under this section shall apply
with respect to a State only upon a
determination by the Secretary that, under the
State law or other applicable rules of such
State, the payment of extended compensation for
which an individual is otherwise eligible must
be deferred until after the payment of any
pandemic emergency unemployment compensation
under subsection (b) for which the individual
is concurrently eligible.
(B) Special rule.--In the case of an
individual who is receiving extended
compensation under the State law for the week
that includes the date of enactment of this
subparagraph (without regard to the amendments
made by subsections (a) and (b) of section 206
of the Continued Assistance for Unemployed
Workers Act of 2020) or for the week that
includes the date of enactmentof the American
Rescue Plan Act of 2021 (without regard to
theamendments made by subsections (a) and (b)
of section 9016 ofsuch Act), such individual
shall not be eligible to receive pandemic
emergency unemployment compensation by reason
of such amendments until such individual has
exhausted all rights to such extended benefits.
(6) Nonreduction rule.--
(A) In general.--An agreement under this
section shall not apply (or shall cease to
apply) with respect to a State upon a
determination by the Secretary that the method
governing the computation of regular
compensation under the State law of that State
has been modified in a manner such that the
number of weeks (the maximum benefit
entitlement), or the average weekly benefit
amount, of regular compensation which will be
payable during the period of the agreement will
be less than the number of weeks, or the
average weekly benefit amount, of the average
weekly benefit amount of regular compensation
which would otherwise have been payable during
such period under the State law, as in effect
on January 1, 2020.
(B) Maximum benefit entitlement.--In
subparagraph (A), the term ``maximum benefit
entitlement'' means the amount of regular
unemployment compensation payable to an
individual with respect to the individual's
benefit year.
(7) Actively seeking work.--
(A) In general.--Subject to subparagraph (C),
for purposes of paragraph (2)(D), the term
``actively seeking work'' means, with respect
to any individual, that such individual--
(i) is registered for employment
services in such a manner and to such
extent as prescribed by the State
agency;
(ii) has engaged in an active search
for employment that is appropriate in
light of the employment available in
the labor market, the individual's
skills and capabilities, and includes a
number of employer contacts that is
consistent with the standards
communicated to the individual by the
State;
(iii) has maintained a record of such
work search, including employers
contacted, method of contact, and date
contacted; and
(iv) when requested, has provided
such work search record to the State
agency.
(B) Flexibility.--Notwithstanding the
requirements under subparagraph (A) and
paragraph (2)(D), a State shall provide
flexibility in meeting such requirements in
case of individuals unable to search for work
because of COVID-19, including because of
illness, quarantine, or movement restriction.
(8) Special rule for extended compensation.--At the
option of a State, for any weeks of unemployment
beginning after the date of the enactment of this
paragraph and before September 6, 2021, an individual's
eligibility period (as described in section 203(c) of
the Federal-State Extended Unemployment Compensation
Act of 1970 (26 U.S.C. 3304 note)) shall, for purposes
of any determination of eligibility for extended
compensation under the State law of such State, be
considered to include any week which begins--
(A) after the date as of which such
individual exhausts all rights to pandemic
emergency unemployment compensation; and
(B) during an extended benefit period that
began on or before the date described in
subparagraph (A).
(b) Pandemic Emergency Unemployment Compensation Account.--
(1) In general.--Any agreement under this section
shall provide that the State will establish, for each
eligible individual who files an application for
pandemic emergency unemployment compensation, an
pandemic emergency unemployment compensation account
with respect to such individual's benefit year.
(2) Amount in account.--The amount established in an
account under subsection (a) shall be equal to 53 times
the individual's average weekly benefit amount, which
includes the amount of Federal Pandemic Unemployment
Compensation under section 2104, for the benefit year.
(3) Weekly benefit amount.--For purposes of this
subsection, an individual's weekly benefit amount for
any week is the amount of regular compensation
(including dependents' allowances) under the State law
payable to such individual for such week for total
unemployment plus the amount of Federal Pandemic
Unemployment Compensation under section 2104.
(4) Coordination of pandemic emergency unemployment
compensation with regular compensation.--
(A) In general.--If--
(i) an individual has been determined
to be entitled to pandemic emergency
unemployment compensation with respect
to a benefit year;
(ii) that benefit year has expired;
(iii) that individual has remaining
entitlement to pandemic emergency
unemployment compensation with respect
to that benefit year; and
(iv) that individual would qualify
for a new benefit year in which the
weekly benefit amount of regular
compensation is at least $25 less than
the individual's weekly benefit amount
in the benefit year referred to in
clause (i),
then the State shall determine eligibility for
compensation as provided in subparagraph (B).
(B) Determination of eligibility.--For
individuals described in subparagraph (A), the
State shall determine whether the individual is
to be paid pandemic emergency unemployment
compensation or regular compensation for a week
of unemployment using one of the following
methods:
(i) The State shall, if permitted by
State law, establish a new benefit
year, but defer the payment of regular
compensation with respect to that new
benefit year until exhaustion of all
pandemic emergency unemployment
compensation payable with respect to
the benefit year referred to in
subparagraph (A)(i).
(ii) The State shall, if permitted by
State law, defer the establishment of a
new benefit year (which uses all the
wages and employment which would have
been used to establish a benefit year
but for the application of this
subparagraph), until exhaustion of all
pandemic emergency unemployment
compensation payable with respect to
the benefit year referred to in
subparagraph (A)(i).
(iii) The State shall pay, if
permitted by State law--
(I) regular compensation
equal to the weekly benefit
amount established under the
new benefit year; and
(II) pandemic emergency
unemployment compensation equal
to the difference between that
weekly benefit amount and the
weekly benefit amount for the
expired benefit year.
(iv) The State shall determine rights
to pandemic emergency unemployment
compensation without regard to any
rights to regular compensation if the
individual elects to not file a claim
for regular compensation under the new
benefit year.
(c) Payments to States Having Agreements for the Payment of
Pandemic Emergency Unemployment Compensation.--
(1) In general.--There shall be paid to each State
that has entered into an agreement under this section
an amount equal to 100 percent of the pandemic
emergency unemployment compensation paid to individuals
by the State pursuant to such agreement.
(2) Treatment of reimbursable compensation.--No
payment shall be made to any State under this section
in respect of any compensation to the extent the State
is entitled to reimbursement in respect of such
compensation under the provisions of any Federal law
other than this section or chapter 85 of title 5,
United States Code. A State shall not be entitled to
any reimbursement under such chapter 85 in respect of
any compensation to the extent the State is entitled to
reimbursement under this section in respect of such
compensation.
(3) Determination of amount.--Sums payable to any
State by reason of such State having an agreement under
this section shall be payable, either in advance or by
way of reimbursement (as may be determined by the
Secretary), in such amounts as the Secretary estimates
the State will be entitled to receive under this
section for each calendar month, reduced or increased,
as the case may be, by any amount by which the
Secretary finds that the Secretary's estimates for any
prior calendar month were greater or less than the
amounts which should have been paid to the State. Such
estimates may be made on the basis of such statistical,
sampling, or other method as may be agreed upon by the
Secretary and the State agency of the State involved.
(d) Financing Provisions.--
(1) Compensation.--
(A) In general.--Funds in the extended
unemployment compensation account (as
established by section 905(a) of the Social
Security Act (42 U.S.C. 1105(a)) of the
Unemployment Trust Fund (as established by
section 904(a) of such Act (42 U.S.C. 1104(a))
shall be used for the making of payments to
States having agreements entered into under
this section.
(B) Transfer of funds.--Notwithstanding any
other provision of law, the Secretary of the
Treasury shall transfer from the general fund
of the Treasury (from funds not otherwise
appropriated) to the extended unemployment
compensation account such sums as the Secretary
of Labor estimates to be necessary to make
payments described in subparagraph (A). There
are appropriated from the general fund of the
Treasury, without fiscal year limitation, the
sums referred to in the preceding sentence and
such sums shall not be required to be repaid.
(2) Administration.--
(A) In general.--There are appropriated out
of the employment security administration
account (as established by section 901(a) of
the Social Security Act (42 U.S.C. 1101(a)) of
the Unemployment Trust Fund, without fiscal
year limitation, such funds as may be necessary
for purposes of assisting States (as provided
in title III of the Social Security Act (42
U.S.C. 501 et seq.)) in meeting the costs of
administration of agreements under this
section.
(B) Transfer of funds.--Notwithstanding any
other provision of law, the Secretary of the
Treasury shall transfer from the general fund
of the Treasury (from funds not otherwise
appropriated) to the employment security
administration account such sums as the
Secretary of Labor estimates to be necessary to
make payments described in subparagraph (A).
There are appropriated from the general fund of
the Treasury, without fiscal year limitation,
the sums referred to in the preceding sentence
and such sums shall not be required to be
repaid.
(3) Certification.--The Secretary shall from time to
time certify to the Secretary of the Treasury for
payment to each State the sums payable to such State
under this subsection. The Secretary of the Treasury,
prior to audit or settlement by the Government
Accountability Office, shall make payments to the State
in accordance with such certification, by transfers
from the extended unemployment compensation account (as
so established) to the account of such State in the
Unemployment Trust Fund (as so established).
(e) Fraud and Overpayments.--
(1) In general.--If an individual knowingly has made,
or caused to be made by another, a false statement or
representation of a material fact, or knowingly has
failed, or caused another to fail, to disclose a
material fact, and as a result of such false statement
or representation or of such nondisclosure such
individual has received an amount of pandemic emergency
unemployment compensation under this section to which
such individual was not entitled, such individual--
(A) shall be ineligible for further pandemic
emergency unemployment compensation under this
section in accordance with the provisions of
the applicable State unemployment compensation
law relating to fraud in connection with a
claim for unemployment compensation; and
(B) shall be subject to prosecution under
section 1001 of title 18, United States Code.
(2) Repayment.--In the case of individuals who have
received amounts of pandemic emergency unemployment
compensation under this section to which they were not
entitled, the State shall require such individuals to
repay the amounts of such pandemic emergency
unemployment compensation to the State agency, except
that the State agency may waive such repayment if it
determines that--
(A) the payment of such pandemic emergency
unemployment compensation was without fault on
the part of any such individual; and
(B) such repayment would be contrary to
equity and good conscience.
(3) Recovery by state agency.--
(A) In general.--The State agency shall
recover the amount to be repaid, or any part
thereof, by deductions from any pandemic
emergency unemployment compensation payable to
such individual under this section or from any
unemployment compensation payable to such
individual under any State or Federal
unemployment compensation law administered by
the State agency or under any other State or
Federal law administered by the State agency
which provides for the payment of any
assistance or allowance with respect to any
week of unemployment, during the 3-year period
after the date such individuals received the
payment of the pandemic emergency unemployment
compensation to which they were not entitled,
in accordance with the same procedures as apply
to the recovery of overpayments of regular
unemployment benefits paid by the State.
(B) Opportunity for hearing.--No repayment
shall be required, and no deduction shall be
made, until a determination has been made,
notice thereof and an opportunity for a fair
hearing has been given to the individual, and
the determination has become final.
(4) Review.--Any determination by a State agency
under this section shall be subject to review in the
same manner and to the same extent as determinations
under the State unemployment compensation law, and only
in that manner and to that extent.
(5) Statute of limitations.--
(A) In general.--Notwithstanding any other
provision of law and subject to subparagraph
(B), any criminal prosecution or civil
enforcement action for a violation of, or
conspiracy to violate, section 371, 641, 1028A,
1029, 1341, 1343, 1344, 1349, 1956, or 1957 of
title 18, United States Code, or section 3729
or 3802 of title 31, United States Code, with
respect to any unemployment compensation claim
funded in whole or in part by Pandemic
Emergency Unemployment Compensation under this
section shall be brought not later than 10
years after the date of the violation or
conspiracy.
(B) Exception.--Subparagraph (A) shall not
apply with respect to a criminal prosecution or
civil enforcement action if the statute of
limitations applicable to such criminal
prosecution or civil enforcement action expired
prior to the date of enactment of the Recover
COVID Unemployment Fraud in Banks Act.
(f) Definitions.--In this section, the terms
``compensation'', ``regular compensation'', ``extended
compensation'', ``benefit year'', ``base period'', ``State'',
``State agency'', ``State law'', and ``week'' have the
respective meanings given such terms under section 205 of the
Federal-State Extended Unemployment Compensation Act of 1970
(26 U.S.C. 3304 note).
(g) Applicability.--An agreement entered into under this
section shall apply to weeks of unemployment--
(1) beginning after the date on which such agreement
is entered into; and
(2) ending on or before September 6, 2021.
* * * * * * *
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