California EDD's 31 billion Fraud Debacle for 2020

https://abc7news.com/california-edd-unemployment-fraud-ca-scam-insurance/10011810/

In an EDD conference call, Julie Su, secretary for the California Labor and Workforce Development Agency said, "Of the 114 billion dollars in unemployment paid by California since March, approximately 10% has been confirmed as fraudulent. An additional 17% of the paid claims have been identified as potentially fraudulent."

That's $11.4 billion confirmed and as much as $20 billion more in fraud.

"There is no sugar coating the reality, California did not have sufficient security measures in place to prevent this level of fraud," Su said.

Keep in mind that this debacle occurred under the watch of California labor secretary Julie Su whom the Biden Administration just nominated for the No. 2 position at the U.S. Labor Department.

Yikes.

https://ktla.com/news/california/julie-su-californias-labor-head-nominated-by-biden-for-deputy-role-amid-states-edd-scandal/

"The California Employment Development falls under Su’s agency, though she does not directly run it."

"State Assemblyman David Chiu, who has been highly critical of the employment department, said that the agency’s problems existed before Su’s tenure and that she has worked to remedy them.

“These were issues beyond her control, but from what I’ve seen she’s done everything, she possibly can to fix the situation,” he said in December, when Asian-American and Pacific Islander groups were urging Biden to appoint Su as the labor secretary."

maybe you should instead ask the EDD director... you know, the person who's direct responsibility this falls under.

And on the other end of the dole:

https://www.businessinsider.in/careers/news/the-wealthiest-1-has-stolen-50-trillion-from-working-americans-a-new-study-finds-heres-what-that-means-/articleshow/78189912.cms

Seems like they require some more oversight, ignoring that I don't know how they define fraud or if it will be confirmed as such. A good case to refine the process, not eliminate it.

So there definitely needs to be some improvement there. Not sure what other reasonable response there is to this.

Unemployment offices still need to be acting quickly to unemployment claims because Covid-19 is still threatening to collapse economies.

Anything that stops them from collecting the fraud?

It's government bureaucracy; but I never stated she ran the department but it certainly happened under her watch. But yes, that's a nice opinion of a CA state assemblyman.

oh ok. so this is a pointless thread. good to know

I'm rather confused why you're triggered over a Biden appointee being mentioned when she clearly was in a position of oversight/power of the EDD. Hopefully she does a much better job at the US department, compared to her work in California, which again, even the extremely liberal LA Times editorial board faulted her on.

But sure, if you think 31 billion in fraud is pointless to the criminals who basked in the free money while many Californians who needed the assistance were delayed and had funds frozen, then more power to you.

@Serraph105: We could definitely manage these systems better. He'll, some of them are intentionally terrible by design, and we waste so much money keeping them that way rather than streamline them in the easiest ways.

Exactly, for example:

"State Auditor Elaine Howle's latest audit says that from April to August of 2020, the EDD made payments to claimants despite concerns about the legitimacy of their identities. The department allowed claimants to collect benefits even though they were using suspicious addresses. In one case, 1,700 claims were coming from the same address. Despite those concerns, staff still made $1 billion in payments to claimants."

You would think a basic address issue would immediately raise a red flag for review. This is crazy.

@Stevo_the_gamer said:

@ogvampire said:

@Stevo_the_gamer said:

It's government bureaucracy; but I never stated she ran the department but it certainly happened under her watch. But yes, that's a nice opinion of a CA state assemblyman.

oh ok. so this is a pointless thread. good to know

I'm rather confused why you're triggered over a Biden appointee being mentioned when she clearly was in a position of oversight/power of the EDD. Hopefully she does a much better job at the US department, compared to her work in California, which again, even the extremely liberal LA Times editorial board faulted her on.

But sure, if you think 31 billion in fraud is pointless to the criminals who basked in the free money while many Californians who needed the assistance were delayed and had funds frozen, then more power to you.

uh, this happened in EVERY State. i thought you read the news, bro.

the UI part of the CARES act was applied haphazardly (short deadline to apply, massive amounts of applications in a short period of time, and pressure on the States to approve as many as possible and as fast as possible.). it was a recipe for fraud... which is why every State has similar issues.

"But sure, if you think 31 billion in fraud is pointless to the criminals who basked in the free money while many Californians who needed the assistance were delayed and had funds frozen, then more power to you."

right, cause that was totally my point. great comprehension skills.

Well that's shitty, but hopefully now that they are aware they can plug the hole and maybe go after these people.

Fraud is to be expected to a certain degree, but this is pretty bad.

I mean, with that money we could have built that high-speed rail we are never going to get! :P

@ogvampire said:

@Stevo_the_gamer said:

I'm rather confused why you're triggered over a Biden appointee being mentioned when she clearly was in a position of oversight/power of the EDD. Hopefully she does a much better job at the US department, compared to her work in California, which again, even the extremely liberal LA Times editorial board faulted her on.

But sure, if you think 31 billion in fraud is pointless to the criminals who basked in the free money while many Californians who needed the assistance were delayed and had funds frozen, then more power to you.

uh, this happened in EVERY State. i thought you read the news, bro.

the UI part of the CARES act was applied haphazardly (short deadline to apply, massive amounts of applications in a short period of time, and pressure on the States to approve as many as possible and as fast as possible.). it was a recipe for fraud... which is why every State has similar issues.

"But sure, if you think 31 billion in fraud is pointless to the criminals who basked in the free money while many Californians who needed the assistance were delayed and had funds frozen, then more power to you."

right, cause that was totally my point. great comprehension skills.

Every state had tens of billions of fraud from unemployment abuse? That would be news to me, in fact, I would say that should be major news to everyone. Hm, "pointless" issue because... is it to be expected? Interesting that some have reached the point where billions in criminal fraud is a pointless non-issue.

Why would it? I mean I hope there was some kind of alarm going off if one address was used multiple times, but this could be something that was learned about after the fact.

Secondly wouldn't address checks be done completely by a computer system?

https://www.kcra.com/amp/article/edd-had-fraud-detection-2016-then-turned-it-off/35491386

"EDD had a fraud detection system in place but stopped using it.

Long before the world had even heard about a virus strain called COVID-19, EDD had signed a contract with a new company called Pondera Solutions. Their system was a fraud detection program.

The Obama administration gave EDD a Department of Labor grant of nearly $2 million in 2013 to install and begin using the system. It was so successful it started getting attention outside EDD.

...

Both that former employee and Pierson say that when the Department of Labor grant ran out, someone at EDD decided that the bill to continue using Pondera -- roughly $2 million a year -- was too high.

Multiple sources tell KCRA 3 Investigates the system would have caught a large portion, if not the majority, of the fraud that hit EDD in 2020."

Well, that's some great adminstrative decisions being made...

@Stevo_the_gamer: Yeah, that kind of penny wise, pound foolish thinking is everywhere in us government. It's baked into our ideology. We're always taking actions like defunding the IRS to let more fraud through than what it cost to prevent it, "saving" thousands of dollars by stopping lead water treatments resulting in millions in costs later, and jailing drug users rather than treating or fining them which magnifies the fiscal and social costs incurred.

To be clear the issue seems to be with unemployment claims in a kind of identity theft form and not people abusing system in representing themselves.

But what I find more alarming is not just that the state's system can't stop it but that these people processing these claims have enough of people's information that they can make fake these claims.

I had discussion with my friend who works at the VA who tells me all the degrees they go through to protect patient information and how serious they treat it. It boggles my mind at same time we have none of this consideration in the private sector and allow for tech companies farm our data and sell it and access our phones and all the data going through it and no surprise some bad actors have enough information to commit fraud whenever they want on whoever they want.

these systems are rife with fraud. oversight if fucking horrific. same thing with the PPP. potentially tens of billions in fraudulent payouts made. the penalties for theft like this should be severe imo

https://www.americanbanker.com/news/bankers-fear-massive-borrower-fraud-in-ppp

Be careful not. Suggesting a little fiscal responsibility and streamlining a program to eliminate waste and fraud, rather than writing blank checks to those who run those programs could get you accused of being a conservative.

I'm sorry, does anyone still believe this stereotype? Seriously, I want a show of hands so I can mock each one individually. It's perpetuated only because Republicans tell you so.

Eoten clearly does

Keep in mind a lot of this fraud also gets through by how overwhelmed the system is considering the problems created by Covid. Still, the human error, I thought it was here or maybe somewhere else but the system created and funded in Obama years to safeguard unemployment only costed a few million but the state didn't want to foot the bill themselves in later years so they dropped it.

Well, fining "drug users" who are all predominantly in the lower socio-economic bracket is akin to fining a transient for illegal camping. In California, when drugs were felonious, courts imposed prop-36 court to offenders to receive probation and do drug treatment programs instead of jail time. Now, since they are all misdemeanors (with the exception of possession for sales of controlled substances), defendants are routinely released on their own recognizance and routinely fail to appear for court up to half a dozen or more times, all the while still getting high and still generating calls for service for patrol. There's no incentive for habitual users to show up, so the cycle just continues and continues until they overdose/get arrested for a different felony.

Luckily, patrol is behind me now so I don't have to deal with training new officers and don't have to deal with the drag of that nonsense.

Silly question, why wouldn't those payments have been done by social security number instead of address?

@Stevo_the_gamer: I'd prefer straight up legalization, but I didn't think you and the other Republicans, as a group, would be open to it.

I'd rather not walk by people slamming heroin or smoking meth. Also, would rather not find used needles in parks and on walking paths which I routinely see and deal with both on and off duty. But to each their own.

Oregon decriminalized everything so I look forward to their crime stats within the next 5 years. In fact, I tell quite a few of my "fellow Californians" to move to Portland every chance I get. :)