In a stunning interview that’s lighting up conservative media, tech titan Elon Musk sat down with Lara Trump on her hit Fox News program My View and pulled the curtain back on what could be one of the most explosive government fraud scandals in modern U.S. history. Musk revealed that approximately 100,000 federal employees have allegedly been illegally collecting unemployment benefits while still on the federal payroll—a massive violation that took place right under the nose of the Biden administration.
The bombshell came during a frank discussion about government waste and inefficiency, a topic President Donald Trump has long campaigned against. Musk, who has become increasingly vocal about his concerns with federal overreach and corruption under Democrat leadership, didn’t mince words.
“We’ve actually found there’s a lot of people who are federal government employees,” Musk told Lara Trump. “These folks are still working—getting paid by the taxpayers—and drawing unemployment. That’s fraud. It’s criminal.”
The revelations come from an internal watchdog group linked to the Department of Government Efficiency (DOGE), a nonpartisan group that has become more prominent as Republicans call for stricter accountability and oversight in federal agencies. Musk noted that the team uncovered shocking evidence of widespread abuse of unemployment insurance systems—evidence pointing directly to massive failures in Biden-era oversight mechanisms.
When pressed by Lara Trump for clarification, Musk confirmed the scale of the problem: “While they’re federal employees? Yes. Wow. And this appears to be at least 100,000 people.”
That number is staggering—and if even partially accurate, it means American taxpayers have been robbed of hundreds of millions, possibly billions, of dollars by their own federal workforce. And yet, no federal agency has come forward to admit fault or announce investigations. The Department of Labor has stayed silent. The Biden administration has stayed silent. And the left-wing media? Predictably, they’ve buried the story.
This scandal underscores exactly what President Trump has warned about for years: an entrenched, bloated bureaucracy riddled with inefficiency, corruption, and total lack of accountability. It’s yet another reason why Americans put Trump back in office in 2024—to finish what he started and drain the swamp once and for all.
Conservative lawmakers on Capitol Hill are already demanding answers. House Oversight Committee members are reportedly reviewing the DOGE report and considering subpoenas if the Department of Labor and other relevant agencies continue to stonewall.
Senator Josh Hawley and Representative Jim Jordan have called for a full federal audit of the unemployment insurance system, particularly the funds dispersed during the COVID-era stimulus expansion under Biden, which was rife with unchecked claims and botched oversight.
“We knew there was fraud in the unemployment system,” said Rep. Jordan. “But this kind of institutional rot—100,000 federal employees committing fraud—this is an indictment of the entire administrative state under Biden.”
Let’s be clear: knowingly collecting unemployment while still employed is criminal insurance fraud. Depending on the state and the amount involved, these violations can be prosecuted as misdemeanors or felonies. In some states, convicted individuals face prison time and fines exceeding $50,000.
And yet, despite this being black-and-white fraud, no action has been taken. No charges filed. No agencies named. No heads rolling. Why? Because this appears to be yet another example of the unaccountable deep state shielding itself—a recurring theme under Biden’s weak leadership.
The federal unemployment insurance system is supposed to be a carefully monitored joint effort between state and federal agencies. But under the Biden administration, that system appears to have become a piggy bank for insiders, with zero transparency and minimal enforcement.
Musk didn’t reveal which agencies were implicated or exactly how long the fraud has been ongoing. But the scale of the allegation—and the fact that such a massive breach of public trust has gone unnoticed or ignored—points to a far deeper crisis within the federal bureaucracy.
During the COVID-19 pandemic, unemployment benefits were expanded dramatically under Biden, including through the disastrous American Rescue Plan. As fraud exploded, federal oversight collapsed. Billions of taxpayer dollars vanished into a black hole of bogus claims, phantom businesses, and identity theft rings. And now, it appears even government employees may have gotten in on the grift.
Lara Trump, a rising star in conservative media and a sharp political voice in her own right, didn’t let the moment pass. Her interview with Musk was direct, revealing, and offered the kind of unfiltered truth Americans no longer get from the legacy media. She echoed what millions of hardworking Americans are feeling: disgust, frustration, and a renewed sense of urgency to hold the government accountable.
This scandal isn’t just about fraud—it’s about trust. It’s about whether the federal government exists to serve the people or enrich itself. Under President Trump, waste, fraud, and abuse were investigated and prosecuted. He signed executive orders to root out inefficiency and cut red tape. He empowered inspectors general, slashed bloated budgets, and made bureaucrats actually do their jobs.
Now, in his second term, Trump and his America First team are poised to go even further. From firing corrupt bureaucrats to streamlining the federal workforce, Trump’s plan is to clean house—permanently.
If the Biden-era bureaucracy allowed 100,000 federal employees to collect unemployment fraudulently while working, then this is just the tip of the iceberg. It’s time for a full reckoning.
RedState will continue to follow this developing story closely and keep readers updated as more facts emerge. But one thing is clear: this is not a glitch—it’s systemic abuse, and only bold leadership like President Trump’s can restore integrity to our government.
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