The Department of Labor (DOL), in conjunction with the White House Task Force to Eliminate Fraud, has dispatched a strike force to New York to address significant unemployment fraud. DOL Inspector General Anthony D’Esposito stated that New York has exhibited fraud and improper payment rates on an unprecedented scale, costing taxpayers an estimated $2 million per day.
According to numbers reported by the state to the federal government, New York was responsible for $750 million in improper unemployment insurance claims, with $507 million of those payments made in 2025. The Trump administration aims to recoup funds it asserts were obtained fraudulently.
The DOL identified New York as having the highest unemployment insurance fraud rate in the nation at 15%, and the highest improper payment rate at 23%. Of the $507 million in overpayments, the state has recovered only 25%, which is substantially lower than the national average loss prevention rate of 69%.
A spokesperson for New York Governor Kathy Hochul's office affirmed that the governor is actively implementing policies to combat fraud, a priority for the Trump administration. "Governor Hochul and the State Department of Labor take fraud and abuse very seriously," the spokesperson said. "We will continue to work with our law enforcement partners to pursue criminals and hold perpetrators accountable while ensuring workers receive the benefits to which they are entitled under law efficiently."
The DOL described its collaboration with the White House Task Force for Eliminating Fraud as "unprecedented." President Trump instituted the task force by executive order in March, appointing Vice President JD Vance to lead the initiative. The administration's stated goal is to "use all available resources and authorities to fight fraud, close loopholes, enforce eligibility rules, and protect benefits for eligible Americans."
The DOL's effort in New York is distinguished by the embedding of Office of the Inspector General special agents directly with the New York State Department of Labor. These agents will work on criminal referrals and investigations. D'Esposito emphasized the aggressive nature of these newly assembled strike teams, stating, "Never before has the U.S. Department of Labor and our Office of Inspector General unleashed this level of coordination in the war on fraud."