Recover COVID Unemployment Fraud in Banks Act

This bill would create a task force led by a National Recovery Coordinator to identify pandemic-era unemployment benefits that were loaded onto prepaid debit cards and are now sitting unclaimed with banks or state unclaimed-property offices. The task force—made up of officials from the Justice Department, Labor Department, Treasury, FDIC, and Consumer Financial Protection Bureau—would develop standard procedures for reviewing these payments, determining which were improper, and returning eligible funds to the states or federal government. It would also issue guidance to banks and state agencies on how to legally return the money and would create a model notice informing individuals if their identity was used fraudulently to obtain these benefits. The bill separately extends, from the standard period to 10 years, the statute of limitations for criminal or civil fraud cases tied to three specific pandemic unemployment programs (pandemic unemployment assistance, Federal Pandemic Unemployment Compensation, and pandemic emergency unemployment compensation), though cases already time-barred before enactment would not be revived.

The bill primarily affects state unemployment agencies, financial institutions holding unclaimed pandemic benefit funds, and individuals whose identities may have been used for fraudulent claims. It also directs the Labor Department to reimburse states for related administrative costs.

The bill was introduced in the Senate on August 5, 2026, by Sen. James Lankford and referred to the Senate Finance Committee. It would need to be approved by that committee, pass the full Senate and House, and be signed by the President before becoming law.

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