Elon Musk's latest government waste reveal has sparked headlines — and scrutiny. Last week, the Department of Government Efficiency announced it had found $382 million in fraudulent unemployment insurance claims.
According to DOGE's post on X, the claims included benefits going to 24,500 people over the age of 115, 28,000 toddlers, and nearly 10,000 individuals with birthdates in the future — including one person reportedly born in the year 2154.
Don't Miss:
- Deloitte's fastest-growing software company partners with Amazon, Walmart & Target – Many are rushing to grab 4,000 of its pre-IPO shares for just $0.26/share!
- Can you guess how many retire with a $5,000,000 nest egg? The percentage may shock you.
Musk himself reacted with disbelief, writing that he had to read the report "several times before it sank in."
But according to economists and labor policy experts, there's a catch: Much of this fraud was already investigated — and reported — by federal agencies years ago.
‘Not News to Anyone,' Experts Say
The DOGE team's findings, while eye-catching, mirror data previously documented by the U.S. Department of Labor's inspector general. According to Fortune, the alleged fraud involving elderly and young claimants was largely linked to "pseudo claims" created to protect victims of identity theft during the COVID-19 pandemic.
These pseudo claims were never meant to be paid out to actual toddlers or people born in the next century. Instead, they allowed states to document fraud without linking stolen identities to real claimants.
"It's been widely reported," Amy Traub, an unemployment expert at the National Employment Law Project, told Fortune. "There've been multiple congressional hearings."
Trending: It’s no wonder Jeff Bezos holds over $250 million in art — this alternative asset has outpaced the S&P 500 since 1995, delivering an average annual return of 11.4%. Here’s how everyday investors are getting started.
Fraud During the Pandemic Was Real — And Much Bigger
There's no doubt fraud occurred during the pandemic. In 2022, the Labor Department estimated COVID-era unemployment fraud had surpassed $45 billion. The Government Accountability Office later suggested the true figure was far higher — between $100 billion and $135 billion.
By comparison, the $382 million figure cited by DOGE represents a small slice of what experts already knew.
During the pandemic, many state unemployment systems were overwhelmed by the sudden surge in claims. This strain made it easier for fraudulent applications to go undetected, especially as relief programs expanded eligibility and increased benefit amounts. In some cases, states used placeholder data to flag suspicious claims, which later showed up in records as payments to toddlers, centenarians, or even people born in the future.
Why Resurfacing Old Fraud Now?
Critics of DOGE say the program may be recycling old data to push a narrative that federal agencies are ineffective. Michele Evermore, a former Department of Labor official, told Fortune that DOGE appears to be highlighting fraud that was "marked as fraud" long ago.
"They're trying to spin this narrative of, ‘Oh, government is inefficient and government is stupid and they're catching these things that the government didn't catch," she said.
Still, some officials, like Labor Secretary Lori Chavez-DeRemer, praised DOGE's findings and vowed to continue efforts to recover stolen taxpayer dollars.
What It Means for Unemployment Insurance
For some experts, the concern is less about the accuracy of DOGE's claims and more about the timing. With fears of a recession looming, unemployment insurance could become a lifeline for many Americans.
"It's an attack on the image of a critically important program and perhaps an attempt to undermine public support on unemployment insurance when it couldn't be more important," Traub told Fortune.
While Musk's latest post may grab attention, experts say the real story is one we've already heard — and that lawmakers and agencies have been working on for years.
Read Next:
- Hasbro, MGM, and Skechers trust this AI marketing firm — invest pre-IPO from $0.60 per share now.
- Many are surprised by Mark Cuban's advice for lotto winners: Cash or annuity?
Image: Shutterstock
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
