This story was updated at 7:20 p.m.

Maryland Gov. Larry Hogan said Wednesday the state has uncovered an unemployment fraud scheme involving more than 47,500 fraudulent claims totaling $501 million.

The claims relied on personal information stolen from previous national data breaches, according to the governor. Hogan added that state employees uncovered the scheme after noticing an usual number of out-of-state applications for the new Pandemic Unemployment Assistance (PUA) program.

He said the state froze out-of-state payments and alerted federal officials to the scheme.

Hogan stressed that Maryland’s unemployment system itself has not experienced a data breach, and no claimants’ personal information has been compromised. The governor also said that, in uncovering fraud and notifying federal officials, Maryland was able to help “shed light on related fraudulent criminal activities in at least a dozen states.”

Maryland Secretary of Labor Tiffany Robinson said PUA claimants, who are self-employed or gig workers, can self certify that they are unemployed, removing the “employer check and balance” that exists for regular claims. She commended Labor Department employees for staying “vigilant” and responding quickly to the fraud.

Maryland officials have been coordinating with the Maryland U.S. Attorney and the U.S. Department of Labor’s Office of the Inspector General.  

“This criminal enterprise, seeking to take advantage of a global pandemic to steal hundreds of millions, perhaps billions, of dollars from taxpayers is despicable,” Hogan said at a Wednesday news conference.     

The governor explained that Maryland froze all out-of -state accounts so authorities could conduct the investigation and, ultimately, clear out the more than 47,000 fraudulent accounts. Some real claimants have been caught up in the investigation.

“A few real people who really needed benefits got caught up in that because we had to put a hold on all those payments,” Hogan said, “But the department [of labor] is working diligently to process them as quickly as possible.”

Last week, FOX5 reported that, due to fraud concerns, the Maryland Labor Department had rescinded payments for some out-of-state residents who worked, and filed for unemployment, in Maryland. One woman told FOX5 that she had to submit additional documents to verify her identity.

Concerns about insurance fraud have been heightened as unemployment claims surge around the country, due to the coronavirus. States have struggled to process the massive number of claims. Maryland created a new website to process both regular unemployment insurance, and CARES Act unemployment programs. It quickly buckled under demand, and some Maryland residents reported long delays in receiving their payments.

Hogan said the state has administered unemployment benefits to 489,000 people.

Other states have reported unemployment insurance fraud. Last week, the FBI issued a statement warning of a “spike” in fraudulent claims involving stolen personal information. “U.S. citizens from several states have been victimized by criminal actors impersonating the victims and using the victims’ stolen identifies to submit fraudulent unemployment insurance claims online,” the FBI said in a statement.

The Bureau said “criminals obtain the stolen identifies using a variety of techniques,” citing the purchase of stolen personal information from past data breaches and email phishing schemes, among others.