A group of California lawmakers announced a package of legislation today to bring necessary reforms and oversight to the Employment Development Department’s (EDD) unemployment insurance (UI) program. The bills would enact crucial oversight and consumer protection measures, ensure claimants get timely access to benefits, and address fraud.
Since the start of the pandemic, there have been widespread reports of the trouble at the EDD. Millions of Californians have struggled to access the unemployment benefits they are legally entitled to, leaving many vulnerable without income or recourse during a pandemic and recession. Despite mass fraud prevention account freezes that harmed thousands of legitimate UI claimants, EDD has still fallen prey to rampant unemployment fraud, most egregiously coming out of California prisons.
Representatives from EDD and Bank of America addressed a State Assembly hearing to shed light on the scope of fraud within California s unemployment program.
Assembly Bill 74: From Assemblywoman Lorena Gonzalez (D-San Diego). Provides claimants with the option to receive their unemployment payments (as well as disability and paid family leave) via direct deposit. Currently, California is only one of three states that do not provide direct deposit; instead, the state is contracted with Bank of America to send payments to a debit card. However, complaints have mounted that Bank of America has failed to protect its cardholders, leaving them vulnerable to fraud, and to having their accounts frozen by the bank if they detect suspicious activity leaving cardholders without access to their funds as they try to navigate the bank s appeals process.
The state auditor’s report was ordered by lawmakers who criticized California’s unemployment agency for a backlog of claims and failing to prevent widespread fraud.
Bay Area resident Laurel Carter joined the lawmakers’ event, saying her legitimate claim was suspended in mid-December with “no other explanation given.” She had difficulty uploading documents to prove her identity and was told she would have a five-hour wait to talk to a representative for help.
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“I slept with my computer on for eight days just thinking that maybe in the middle of the night I would hear a ding and it would be someone that would speak to me,” Carter said. “I am now six weeks in without any payment.”