Reducing Fraud in Unemployment Assistance Act This bill sets forth provisions to combat fraud by federal inmates with respect to unemployment compensation. The bill requires a state's unemployment compensation law to provide that the state's agency in charge of administering unemployment compensation must (1) enter into an agreement with the Attorney General under which the list of individuals receiving unemployment compensation within that state shall be regularly compared with a list of each prisoner in federal and state custody at a federal or state correctional facility within that state; and (2) use the results of each such comparison to investigate and prosecute fraud, waste, and abuse of unemployment compensation under the state's law. The full federal share of payments to states for extended and regular unemployment compensation shall exclude any overpayment of pandemic unemployment assistance, federal pandemic unemployment compensation, and mixed earner unemployment compensation recovered by a state.