Trump’s Labor Department just recovered a staggering $1.4 billion in pandemic-era unemployment funds that states were hoarding for years after the programs ended.
At a Glance
- Labor Secretary Lori Chavez-DeRemer returned $1.4 billion in unused pandemic-era unemployment funds to the Treasury’s General Fund
- The Department is working to recover an additional $2.9 billion in unspent pandemic relief money
- A 2023 audit revealed states improperly kept billions of dollars despite no longer meeting requirements
- The funds came from the 2020 CARES Act unemployment assistance programs that have since ended
- The Labor Department identified over $105 million in questionable spending across multiple states
Billions in COVID Funds Recovered After Years of Gathering Dust
The U.S. Department of Labor under Secretary Lori Chavez-DeRemer has successfully recovered $1.4 billion in unused pandemic-era unemployment funds that states had been improperly holding onto years after the programs ended. This massive recovery represents the first phase of an ongoing effort to reclaim approximately $4.3 billion in taxpayer money that should have been returned to the federal government when the temporary assistance programs expired.
The recovered funds originated from the Coronavirus Aid, Relief, and Economic Security (CARES) Act of March 2020, which provided emergency assistance during the early stages of the pandemic. Despite these programs having long since concluded, a 2023 audit by the Department’s Office of Inspector General revealed that billions in unspent funds remained under state control, with inadequate oversight to ensure their proper return to federal coffers.
States Caught Holding Onto Billions Despite Programs Ending
The investigation into these unspent funds began after troubling revelations from a comprehensive audit conducted last year. The audit uncovered that the Employment and Training Administration lacked sufficient controls to monitor the use of these funds, allowing states to maintain possession of approximately $4.3 billion that should have been returned. Even more concerning, auditors identified over $105 million in questionable expenses across multiple states including Delaware, Oregon, Mississippi, and Louisiana.
“There’s no reason leftover COVID unemployment funds should still be collecting dust,” said Chavez-DeRemer. “Any money still sitting around for pandemic-era unemployment funds is a clear misuse of Americans’ hard-earned tax dollars.”
The discovery that states continued holding these funds years after the programs had expired represents a significant failure of financial oversight from the previous administration. The pandemic-era unemployment assistance programs were designed as temporary measures during extraordinary circumstances, not permanent slush funds for states to retain indefinitely.
Labor Department Pushing to Recover Additional $2.9 Billion
Secretary Chavez-DeRemer’s team isn’t stopping with this initial recovery. The Department has launched aggressive efforts to reclaim the remaining $2.9 billion in unspent funds still being held by states. This initiative aligns with President Trump’s broader mission to eliminate government waste and return control of finances to American taxpayers rather than bureaucratic agencies.
“It’s unacceptable that billions of dollars went unchecked in a program that ended several years ago. In a huge win for the American taxpayer, we’ve clawed back these unused funds and will keep working to eliminate waste, fraud, and abuse,” said Deputy Secretary of Labor Keith Sonderling.
The Labor Department’s success in recovering these funds demonstrates the Trump administration’s commitment to fiscal responsibility. Secretary Chavez-DeRemer has indicated she plans to work closely with the Department of Government Efficiency (DOGE) to further optimize resource use and ensure taxpayer funds are properly managed. The reclamation of these funds represents just the beginning of a comprehensive effort to address financial mismanagement across government programs.
Protecting Taxpayer Dollars Through Accountability
This recovery operation comes at a critical time when American taxpayers are still feeling the effects of inflation and economic hardship partly caused by excessive government spending during the pandemic. By returning these funds to the Treasury’s General Fund, the Labor Department is taking concrete steps to demonstrate fiscal responsibility and accountability to the American people who ultimately provided these resources.
“I’m keeping my promise to be a good steward of your money by rooting out waste to ensure American Workers always come first,” stated Labor Secretary Lori Chavez-DeRemer.
The successful recovery of these funds stands in stark contrast to the previous administration’s approach to pandemic spending, which saw hundreds of billions lost to fraud and improper payments across various relief programs. By prioritizing the recovery of these misplaced funds, the Trump administration is sending a clear message that fiscal responsibility and proper stewardship of taxpayer dollars will be hallmarks of government operations moving forward.
