S. 1587 — Protecting Taxpayers and Victims of Unemployment Fraud Act

This bill addresses overpayments of unemployment insurance (UI) benefits, including by providing incentives for states to investigate and recover these funds. Specifically, the bill allows a state to retain 25% of any funds recovered from fraudulent overpayments of certain UI benefits that were provided during the COVID-19 pandemic. These retained funds must be used for specified program integrity measures, such as modernizing UI systems and information technology and hiring fraud investigators. The bill allows a state to retain up to 5% of (1) any UI overpayment it recovers, except where the overpayment is due to state agency error; and (2) any unpaid employer contributions that the state...