The numbers are staggering. During the COVID-19 pandemic, the federal government distributed roughly $900 billion in unemployment insurance to help Americans weather job losses. According to the man now running the Department of Labor, $135 billion of that money was simply stolen.
Acting Labor Secretary Keith Sonderling made the explosive claim during a recent appearance on Benny Johnson’s podcast, laying out both the scale of the fraud and the administration’s plan to force states to clean it up — or lose federal funding entirely.
Sonderling’s path to his current role is worth understanding. He was confirmed by the U.S. Senate on March 12, 2025, as the 38th United States Deputy Secretary of Labor. Then, on April 20, 2026, President Donald Trump designated him as Acting Secretary of Labor, the position from which he now speaks with authority on these matters.
When Johnson asked him directly about employment insurance fraud — calling it “a massive vector of fraud in the country” — Sonderling didn’t hold back.
As originally reported, Sonderling began his answer by crediting the broader White House effort, noting that President Trump established a task force on fraud and appointed Vice President JD Vance to lead it. “They’ve put such tremendous efforts across all agencies to really root out fraud,” he said, “particularly in government programs that give out your hard-earned taxpayer dollars.”
The acting secretary explained that the Department of Labor’s specific role centers on unemployment insurance — and the numbers tied to pandemic-era abuse are eye-opening.
“During COVID, $900 billion was given out to help people get back on their feet,” Sonderling said. “But during the Biden administration, $135 billion of that money was stolen by fraud.”
That’s not a rounding error. That’s roughly 15 cents of every dollar distributed vanishing into fraudulent schemes — money that came directly from American taxpayers.
Sonderling made clear the administration isn’t just identifying the problem. It intends to act, and states that drag their feet should expect consequences. He indicated that blue states failing to get unemployment fraud under control could face a cutoff of federal funds — a hardball approach designed to force accountability at the state level where much of the program is administered.
The fraud crackdown fits squarely within the broader Trump administration effort to eliminate waste and abuse across federal programs, an initiative that has gained significant momentum since the president’s return to office.
For the millions of Americans who paid into these systems expecting them to function as a genuine safety net, the revelation that $135 billion was siphoned away is a gut punch. The administration is betting that tough talk — backed by a real threat to the federal money pipeline — will finally move the needle.
Whether it works remains to be seen. But Sonderling is clearly signaling that the days of looking the other way are over.