PREGERSON, Circuit Judge:
Ms. Facchini and the other appellants were convicted of violating 18 U.S.C. § 1001 (1982), which prohibits a person from making materially false statements in a matter within the jurisdiction of a federal department or agency. We took this case en banc to determine whether the extent of federal involvement in a state unemployment insurance program justifies imposing federal criminal liability under section 1001 on claimants who made misrepresentations on applications for state unemployment benefits. We must also determine whether [640]*640other claimants who received federal unemployment benefits as a result of false statements made to state unemployment officials can be held criminally liable under section 1001.
BACKGROUND
The facts are not in dispute. Appellants applied to the Oregon Division of Employment for unemployment insurance benefits. They made false statements on initial or supplemental claim forms. As a result, they improperly received unemployment benefits. With regard to the source of the benefits, the appellants fall into two distinct categories. Most of the appellants (“first group”) received only benefits paid by the State of Oregon. Four of the appellants (“second group”) however, received federal compensation under a federal supplemental benefits program.1
The appellants were indicted for violation of section 1001. They moved to dismiss the indictment on the grounds that the matters were not within the jurisdiction of a federal agency or department and that the false statements were not material. Upon denial of the motion, the appellants conditionally pleaded guilty under Fed.R.Crim.P. 11(a)(2),2 reserving the right to appeal the denial of their motion to dismiss.
On appeal, a panel of this court affirmed the appellants’ convictions, finding that “[t]he scope of § 1001 ... follows the federal government’s access to information.” United States v. Facchini, 832 F.2d 1159, 1161 (9th Cir.1987), vacated, 851 F.2d 1221 (9th Cir.1988) (citing Bryson v. United States, 396 U.S. 64, 71, 90 S.Ct. 355, 359, 24 L.Ed.2d 264 (1969)).
ANALYSIS
1. UNEMPLOYMENT INSURANCE
Before deciding the issues presented by this appeal, we must first examine the relationship between the two unemployment insurance programs — state and federal — involved here. The first group of appellants received cash payments from an Oregon unemployment insurance program. The Oregon program was established under the federal unemployment compensation system created by Congress in 1935. Or.Rev. Stat. §§ 657.005 et seq. (1987); 49 Stat. 626 (codified at 26 U.S.C. §§ 3301 et seq. (1982 & Supp. IV 1986)). The federal scheme permits a state to operate its own program, provided the Secretary of Labor (the “Secretary”) approves the state’s unemployment plan. 26 U.S.C. § 3304. Of critical importance to our inquiry is this fact: when a state operates a federally-approved program under section 3304, not one cent of federal money goes to pay the unemployment benefits. See Or.Rev.Stat. §§ 657.815(3) (providing that the state benefit fund is the sole and exclusive source for the payment of benefits under the Oregon unemployment insurance program). Thus, Oregon footed the entire bill for the benefits received by the first group of appellants.
Even when a state such as Oregon runs its own unemployment insurance program, there is federal involvement beyond the initial approval of the state plan. Under 42 U.S.C. § 502(a) (Supp. IV 1986), the federal government provides funds for “the proper and efficient administration” of state unemployment insurance laws. The Secretary monitors the operation of the state plan and may stop payment of administrative funds if the state fails properly to administer its unemployment insurance laws. 42 U.S.C. § 503(b) (1982). Thus, the federal government does play a limited role in a state’s unemployment insurance program, but this role does not extend beyond administrative assistance.
The situation is somewhat different with respect to the second group of appellants. These appellants received compensation under a federal program established to provide federal funds for states to pay up to twenty-six weeks of additional unemployment compensation to persons exhausting their compensation rights under an existing [641]*641state program. See Federal Supplemental Compensation Act of 1982, Pub.L. No. 97-248, 96 Stat. 702 (codified at 26 U.S.C. § 3304 note); see also Emergency Unemployment Compensation Act of 1974, Pub. L. No. 93-572, 88 Stat. 1869 (codified at 26 U.S.C. § 3304 note). In contrast to Oregon’s unemployment insurance program, benefits received under this program are paid out of the federal purse. We now address the elements of section 1001 relevant to this case.
2. SECTION 1001 JURISDICTION
Section 1001 states in full:
Whoever, in any matter within the jurisdiction of any department or agency of the United States knowingly and willfully falsifies, conceals or covers up by any trick, scheme, or device a material fact, or makes any false, fictitious or fraudulent statements or representations, or makes or uses any false writing or document knowing the same to contain any false, fictitious or fraudulent statement or entry, shall be fined not more than $10,000 or imprisoned not more than five years, or both.
(emphasis added). There can be no valid conviction under section 1001 unless both jurisdiction and materiality are shown. See United States v. Green, 745 F.2d 1205, 1208 (9th Cir.1984), cert. denied, 474 U.S. 925, 106 S.Ct. 259, 88 L.Ed.2d 266 (1985).
To satisfy section 1001’s jurisdiction requirement, the false statement must concern the “authorized functions of an agency or department” rather than “matters peripheral to the business of that body.” United States v. Rodgers, 466 U.S. 475, 479, 104 S.Ct. 1942, 1946, 80 L.Ed.2d 492 (1984). “A department or agency has jurisdiction, in this sense, when it has the power to exercise authority in a particular situation.” Id.
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PREGERSON, Circuit Judge:
Ms. Facchini and the other appellants were convicted of violating 18 U.S.C. § 1001 (1982), which prohibits a person from making materially false statements in a matter within the jurisdiction of a federal department or agency. We took this case en banc to determine whether the extent of federal involvement in a state unemployment insurance program justifies imposing federal criminal liability under section 1001 on claimants who made misrepresentations on applications for state unemployment benefits. We must also determine whether [640]*640other claimants who received federal unemployment benefits as a result of false statements made to state unemployment officials can be held criminally liable under section 1001.
BACKGROUND
The facts are not in dispute. Appellants applied to the Oregon Division of Employment for unemployment insurance benefits. They made false statements on initial or supplemental claim forms. As a result, they improperly received unemployment benefits. With regard to the source of the benefits, the appellants fall into two distinct categories. Most of the appellants (“first group”) received only benefits paid by the State of Oregon. Four of the appellants (“second group”) however, received federal compensation under a federal supplemental benefits program.1
The appellants were indicted for violation of section 1001. They moved to dismiss the indictment on the grounds that the matters were not within the jurisdiction of a federal agency or department and that the false statements were not material. Upon denial of the motion, the appellants conditionally pleaded guilty under Fed.R.Crim.P. 11(a)(2),2 reserving the right to appeal the denial of their motion to dismiss.
On appeal, a panel of this court affirmed the appellants’ convictions, finding that “[t]he scope of § 1001 ... follows the federal government’s access to information.” United States v. Facchini, 832 F.2d 1159, 1161 (9th Cir.1987), vacated, 851 F.2d 1221 (9th Cir.1988) (citing Bryson v. United States, 396 U.S. 64, 71, 90 S.Ct. 355, 359, 24 L.Ed.2d 264 (1969)).
ANALYSIS
1. UNEMPLOYMENT INSURANCE
Before deciding the issues presented by this appeal, we must first examine the relationship between the two unemployment insurance programs — state and federal — involved here. The first group of appellants received cash payments from an Oregon unemployment insurance program. The Oregon program was established under the federal unemployment compensation system created by Congress in 1935. Or.Rev. Stat. §§ 657.005 et seq. (1987); 49 Stat. 626 (codified at 26 U.S.C. §§ 3301 et seq. (1982 & Supp. IV 1986)). The federal scheme permits a state to operate its own program, provided the Secretary of Labor (the “Secretary”) approves the state’s unemployment plan. 26 U.S.C. § 3304. Of critical importance to our inquiry is this fact: when a state operates a federally-approved program under section 3304, not one cent of federal money goes to pay the unemployment benefits. See Or.Rev.Stat. §§ 657.815(3) (providing that the state benefit fund is the sole and exclusive source for the payment of benefits under the Oregon unemployment insurance program). Thus, Oregon footed the entire bill for the benefits received by the first group of appellants.
Even when a state such as Oregon runs its own unemployment insurance program, there is federal involvement beyond the initial approval of the state plan. Under 42 U.S.C. § 502(a) (Supp. IV 1986), the federal government provides funds for “the proper and efficient administration” of state unemployment insurance laws. The Secretary monitors the operation of the state plan and may stop payment of administrative funds if the state fails properly to administer its unemployment insurance laws. 42 U.S.C. § 503(b) (1982). Thus, the federal government does play a limited role in a state’s unemployment insurance program, but this role does not extend beyond administrative assistance.
The situation is somewhat different with respect to the second group of appellants. These appellants received compensation under a federal program established to provide federal funds for states to pay up to twenty-six weeks of additional unemployment compensation to persons exhausting their compensation rights under an existing [641]*641state program. See Federal Supplemental Compensation Act of 1982, Pub.L. No. 97-248, 96 Stat. 702 (codified at 26 U.S.C. § 3304 note); see also Emergency Unemployment Compensation Act of 1974, Pub. L. No. 93-572, 88 Stat. 1869 (codified at 26 U.S.C. § 3304 note). In contrast to Oregon’s unemployment insurance program, benefits received under this program are paid out of the federal purse. We now address the elements of section 1001 relevant to this case.
2. SECTION 1001 JURISDICTION
Section 1001 states in full:
Whoever, in any matter within the jurisdiction of any department or agency of the United States knowingly and willfully falsifies, conceals or covers up by any trick, scheme, or device a material fact, or makes any false, fictitious or fraudulent statements or representations, or makes or uses any false writing or document knowing the same to contain any false, fictitious or fraudulent statement or entry, shall be fined not more than $10,000 or imprisoned not more than five years, or both.
(emphasis added). There can be no valid conviction under section 1001 unless both jurisdiction and materiality are shown. See United States v. Green, 745 F.2d 1205, 1208 (9th Cir.1984), cert. denied, 474 U.S. 925, 106 S.Ct. 259, 88 L.Ed.2d 266 (1985).
To satisfy section 1001’s jurisdiction requirement, the false statement must concern the “authorized functions of an agency or department” rather than “matters peripheral to the business of that body.” United States v. Rodgers, 466 U.S. 475, 479, 104 S.Ct. 1942, 1946, 80 L.Ed.2d 492 (1984). “A department or agency has jurisdiction, in this sense, when it has the power to exercise authority in a particular situation.” Id.
Even though there may be jurisdiction under section 1001 when the false statement is not made directly to a federal agent, United States v. Kraude, 467 F.2d 37, 38 (9th Cir.), cert. denied, 409 U.S. 1076, 93 S.Ct. 684, 34 L.Ed.2d 664 (1972), and when the federal agency is not affected financially by the false statement, United States v. Gilliland, 312 U.S. 86, 91-93, 61 S.Ct. 518, 521-22, 85 L.Ed. 598 (1941), courts have refused to find jurisdiction unless a direct relationship obtains between the false statement and an authorized function of a federal agency or department. For example, in Rodgers, the Supreme Court found section 1001 jurisdiction where the defendant’s false statements to FBI agents disrupted the FBI's statutorily authorized function of detecting and prosecuting crimes against the United States. 466 U.S. at 479-81, 104 S.Ct. at 1946-47. Moreover, in United States v. Balk, 706 F.2d 1056, 1059 (9th Cir.1983), section 1001 jurisdiction was found where falsified welder certifications were used to obtain work as a Navy contractor because the certifications related directly to the Navy’s authority to hire contractors. Other such examples include: Bryson, 396 U.S. at 70-71, 90 S.Ct. at 359-60 (defendant’s false affidavit related directly to the functioning of the National Labor Relations Board); United States v. Wolf, 645 F.2d 23, 25 (10th Cir.1981) (defendant’s false certification of fuel oil as crude oil impinged directly upon the Department of Energy’s statutory function of regulating oil products). See also United States v. Cartwright, 632 F.2d 1290, 1292-93 (5th Cir.1980) (finding section 1001 applicable to false statements by officer of a wholly-owned subsidiary of an institution insured by the Federal Savings and Loan Insurance Corporation because the FSLIC is authorized to monitor its insureds so as to prevent financial difficulties and the business dealings of the subsidiary have a “profound effect” on the health of the parent).
In the instant case, no such direct relation exists between the first group’s false statements and an authorized function of the Department of Labor. 42 U.S. C. § 502(a) imposes upon the Secretary the duty to certify the payment of administrative funds to approved state unemployment insurance programs. Under section 503(a), before the Secretary is authorized to certify payment of such funds, he must review the state’s laws and find, inter alia, (1) [642]*642provisions for “[s]ueh methods of administration ... as are ... reasonably calculated to insure full payment of unemployment compensation when due”; and (2) provisions making “available upon request” statistical information about recipients of unemployment compensation. 42 U.S.C. §§ 503(a)(1), (7) (1982 & Supp. IV 1986). Thus, the Secretary is authorized to monitor only the administrative structure of the state program to determine whether it complies with federal requirements. The Secretary is not authorized to monitor the actual operation of the state program. Furthermore, the Secretary does not have the authority to withhold certification of federal administrative funds even if a state pays fraudulent claims.3 Thus, fraudulent claims by an applicant for state unemployment benefits cannot pervert the Secretary’s function of monitoring the legal structure of a state’s unemployment insurance program. See Rodgers, 466 U.S. at 480, 104 S.Ct. at 1946 (“ ‘The [1934] amendment [to 18 U.S.C. § 1001, formerly 18 U.S.C. § 80] indicated the congressional intent to protect the authorized functions of governmental departments and agencies from the perversion which might result from the deceptive practices described.’ ”) (quoting Gilliland, 312 U.S. at 93, 61 S.Ct. at 522); see also United States v. Stanford, 589 F.2d 285, 297 (7th Cir.1978), cert. denied, 440 U.S. 983, 99 S.Ct. 1794, 60 L.Ed.2d 244 (1979). Because the Secretary is not empowered to act on the fraudulent claims of applicants for state unemployment benefits, such claims do not fall within the jurisdictional reach of section 1001. See Rodgers, 466 U.S. at 479, 104 S.Ct. at 1946 (defining “jurisdiction” as “the power to exercise authority in a particular situation”).
This en banc decision rejects the position advanced initially by the government that the scope of jurisdiction for section 1001 purposes follows the federal government’s access to information. Mere access to information is not enough to establish jurisdiction. To establish jurisdiction, the information received must be directly related to an authorized function of the federal agency. Otherwise, the scope of section 1001 jurisdiction would be virtually limitless.
In this case, the federal government does have statutory access to information contained in the appellants’ false statements. Under 42 U.S.C. § 503(a)(7) the Secretary is precluded from certifying any state unemployment insurance program unless state law makes information about benefit claimants available to the federal government. Such statements, however, are peripheral to the Secretary’s monitoring function because, as we noted, the Secretary is not authorized to act in response to false statements made to a state unemployment insurance program. See 20 C.F.R. § 601.5(a) (authorizing the Secretary to act when a state improperly denies benefits but not when a state improperly provides benefits). The federal interest in such statements is, therefore, indirect and de minimis.
The government contends that case law sustaining the application of section 1001 to fraudulent claims for benefits under state-operated Aid to Families with Dependent Children (“AFDC”) programs supports the application of section 1001 to state-operated unemployment compensation programs. See, e.g., Stanford, 589 F.2d at 196-98; infra note 4. A comparison of the federal legislation establishing unemployment insurance programs with the legislation establishing AFDC programs, however, points to the opposite conclusion.
The AFDC statutes and regulations specifically define eligibility requirements for AFDC claimants, see, e.g., 42 U.S.C. § 602 (1982 & Supp. IV 1986); no such eligibility provisions can be found in the federal legislation providing grants to states for unemployment compensation administration. See 42 U.S.C. §§ 501 et. seq. (1982 & Supp. IV 1986). More importantly, the Department of Health and Human Services is specifically authorized to reduce federal [643]*643funding to a state AFDC program if that state makes payments to ineligible applicants. 45 C.F.R. § 205.42 (1987). In contrast, the Secretary, as we noted above, is not authorized to withhold federal administrative funds from a program that pays out benefits not due under state law. See 20 C.F.R. § 601.5(a). Thus, implicit in the unemployment insurance scheme, as opposed to the AFDC scheme, is a congressional intent to have the states themselves police their payments of unemployment benefits.
The application of section 1001 to statements made on state claim forms and submitted to a state agency to obtain state-funded benefits would extend federal criminal liability for false statements beyond any established precedent. Moreover, such an extension is not consistent with the federalism concerns implicit in the congressional scheme establishing state unemployment insurance programs. Accordingly, we find that the false statements of the first group do not satisfy section 1001’s jurisdictional requirement.
In contrast, there is little question that the false statements by the second group do satisfy section 1001’s jurisdictional requirement. First, the Federal Supplemental Compensation Act of 1982 explicitly provides that any applicant making false statements in an application for federal supplemental benefits is subject to prosecution under section 1001. Section 606(a)(1)(B), 26 U.S.C. § 3304 note.4 Second, because their false statements gained them benefits paid out of the federal fisc, there is a direct relation between the falsity of those statements and the Department of Labor’s statutory function of certifying the payment of federal money for unemployment compensation. See id. at § 604(a)(2). For these reasons, we find that the false statements made by the second group satisfy section 1001’s jurisdictional requirement.5
3. MATERIALITY
Section 1001’s materiality requirement is closely related to its jurisdiction requirement. “A statement is considered material if it has the propensity to influence agency action; actual influence on agency action is not an element of the crime.” United States v. Vaughn, 797 F.2d 1485, 1490 (9th Cir.1986).
The vacated Facchini panel opinion stated that “[materiality ... is not measured by effect or magnitude.” Facchini, 832 F.2d at 1162. It is important, however, to distinguish between actual and potential effects. In United States v. Valdez, we said that “[t]he government has the burden of proving that the false statement has the intrinsic capability of influencing or affecting the agency’s or department’s decision.” 594 F.2d 725, 728 (9th Cir.1979) (emphasis added). Thus, although materiality may be found in the absence of any actual effect of the false statement on a federal agency, still the statement must be capable of having some non-trivial effect on a federal agency. In other words, to assess intrinsic capability, a court must consider whether a statement could, under some set of foreseeable circumstances, significantly affect an action by a federal department or agency.
[644]*644The false statements of the first group lacked any intrinsic capability to influence action by the Department of Labor. Because they understated their income on forms submitted to the Oregon Division of Employment, these appellants received additional benefits paid entirely by the State of Oregon. The federal government’s role in the Oregon program was limited, as we noted above, to providing administrative funds. The government has not offered any evidence to contradict appellants’ evidence that such misstatements neither increased nor had the propensity to increase the federal government’s expenditure of funds for administrative expenses.6 We are forced to conclude that the effect, actual or potential, of misstatements by any single appellant on the federal government’s limited administrative role is negligible. Therefore, such misstatements cannot satisfy section 1001’s materiality requirement.
In contrast, the false statements of the second group resulted in the improper disbursement of federal funds to these appellants. Given this direct causal link between their statements and action by the Department of Labor, we find that the false statements by the second group are material within the meaning of section 1001.
CONCLUSION
The four appellants who fraudulently obtained federally-funded benefits under the Federal Supplemental Compensation Act of 1982 fall well within the scope of 18 U.S.C. § 1001 because their misrepresentations perverted an authorized function of the Department of Labor. Their convictions are affirmed.
We cannot, however, affirm the convictions of the appellants who received benefits solely from the State of Oregon. The application of section 1001 to individuals who have made false statements on state claim forms submitted to a state unemployment office to obtain state-funded benefits would constitute an unprecedented expansion of the scope of federal criminal law. Accordingly, we conclude that the false statements by the first group do not fall within the jurisdiction of a federal agency or department. We also conclude in the alternative that such statements do not satisfy section 1001’s materiality requirement.
AFFIRMED IN PART (86-3106, 86-3102, 86-3138, 86-3140) and REVERSED IN PART as to all other appellants.