The State of California gave billions in illegal unemployment checks during the scamdemic. That includes people on death row. To pay for this fraud, the State of California has borrowed $18 billion from the Feds—and paying interest.
Yet, the Sacramento Democrats now want to give unemployment checks to illegal aliens and people on strike. Of course that money does not exist.
“In a new report, Parks said he found evidence that the Employment Development Department’s fraud protection and claimant service is inadequate. He also said that its unemployment insurance program suffers a high rate of overturned eligibility decisions.
The Employment Development Department provides billions of dollars in partial wage replacement benefits to unemployed Californians who meet eligibility requirements each year.”
Audit exposes shortfalls in California employment development agency
Fraud is slipping through amid other problems standing in the way of adequate benefit payments, according to findings from a state auditor.
NATALIE HANSON, Courthousenews, 8/24/23 https://www.courthousenews.com/audit-exposes-shortfalls-in-california-employment-development-agency/
SACRAMENTO, Calif. (CN) — California auditor Grant Parks designated the state employment development agency at high risk on Thursday, citing numerous management issues such as inadequate fraud protection and problems with resolving Covid-19 benefit claims.
In a new report, Parks said he found evidence that the Employment Development Department’s fraud protection and claimant service is inadequate. He also said that its unemployment insurance program suffers a high rate of overturned eligibility decisions.
The Employment Development Department provides billions of dollars in partial wage replacement benefits to unemployed Californians who meet eligibility requirements each year.
Starting in March 2020, a surge in pandemic-related unemployment claims increased work for the department. The auditor found in 2021 that significant missteps and inaction during the pandemic led to billions of dollars in unemployment benefit payments — some of which may have been fraudulent. Parks also highlighted the department’s inability to accurately quantify inappropriate unemployment payments, saying it contributed to delays in state financial statement publications for two fiscal years.
No longer able to reliably estimate improper payments, the Employment Development Department now joins the list of state agencies that Parks says became high risk in 2020 due to issues with management of Covid-19 federal funds and late financial reporting.
That affects state financial statements and impairs efforts to independently evaluate fraud prevention activities.
“Further, EDD needs to improve customer service to unemployment insurance claimants, while also taking steps to ensure its eligibility decisions are not frequently overturned on appeal,” Parks said in Thursday’s report. “EDD’s mismanagement of the UI program has resulted in a substantial risk of serious detriment to the state and its residents.”
In credit to the department, the auditor underlines steps it took to strengthen internal controls to identify potentially fraudulent claims and refer them to law enforcement agencies. Until it can accurately determine how many improper payments it has made, however, Parks said the department cannot effectively measure progress at addressing potentially fraudulent payments.
The department also struggles to pay claimants in a timely manner, leaving millions of Californians waiting for long periods to receive benefits or get answers about their claims. In the first six months of 2023, only about 86% of claims were paid, Parks said.
Parks also noted that the department’s eligibility decisions are frequently overturned during appeal, causing delays and substantial risk of serious detriment to residents. From 2017 through 2022, about half of the issues in claims that were appealed were ultimately overturned in favor of the claimant. As of March 2023, California had the third highest reversal rate in the nation.
“These improper eligibility decisions can serve as unnecessary obstacles to claimants’ right to benefits and can result in a significant reduction in the overall effectiveness of the UI program,” Parks said.
But it is the state’s financial reporting delays, Parks emphasized, that pose a high risk. The state controller issued financial statements for fiscal year 2020–21 one year later than in previous years, and financial reporting for fiscal year 2021–22 is already past due.
“This continued trend of late reporting reduces the efficiency and effectiveness of the state’s financial oversight,” Park said.
He pointed out that delays could also affect California’s credit rating. According to the state treasurer, California borrowed $5.6 billion in general obligation bonds in fiscal years 2021–22.
The Department of Finance said in a statement Aug. 4 that it disagreed with Parks’ findings. Director Joe Stephenshaw said that the state Legislature established the Federal Funds Accountability and Cost Tracking unit to track the receipt and expenditure of Covid-19 federal relief funds under six federal bills.
The Employment Development Department’s director Nancy Farias also responded in a statement, saying the pandemic and California’s deferred transition to a new fiscal management program is responsible for her department’s delays in submitting year-end financials.
Farias said her department has one of the nation’s toughest anti-fraud programs. In October 2020, the agency added an identity proofing and authentication platform, supplemented with new fraud detection tools added in January 2021.
Farias said her department has successfully identified and mitigated attempted fraud schemes and stopped nearly $43.4 billion in fraudulent benefit payments. Its Investigation Division has hundreds of joint criminal investigations open with the Fraud Special Counsel, and local, state and federal law enforcement entities.
“During the Covid-19 pandemic, the contact center experienced its most significant call volume periods, with call volumes in the millions per week,” Farias said. “We agree customer satisfaction with the unemployment insurance claim process fell during the pandemic, however, we disagree it remains low.”
