In the category of “you can’t make this stuff up,” Gavin Newsom’s California is a jaw dropper. Over the last few months, we have seen strip clubs deemed “essential” and open, while churches closed.
Main Street shuttered while pot shops flourish. As illogical and confounding as those examples are, nothing has been more infuriating than Newsom’s lackadaisical attitude toward problems at the state’s unemployment agency, the Economic Development Department. The issue du jour: Murderers, rapists and other incarcerated criminals have fraudulently collected almost a billion dollars in unemployment insurance benefits.
Under Newsom’s watch, warning cries of problems at EDD went unanswered. In April, legislators began sounding alarms that the EDD was unable to handle the increased demand. Call lines were only open a few hours a day, antiquated technology and a convoluted bureaucracy slowed processing to a snail’s pace. The feds warned the governor of a high risk of fraud back in the spring — which you’d think would have kick-started the implementation of a 2019 recommendation by the California State Auditor that the EDD stop including full Social Security numbers on its correspondence because it would result in identity theft and fraud – but it didn’t.
Newsom’s solution months later was to form a task force.
Californians need more than a task force, which is why my first order of business for the 2021-22 legislative session will be introducing a bill requiring the EDD to comply immediately with the State Auditor’s 2019 recommendations on removing sensitive information such as Social Security numbers from EDD mail. The failure of the EDD to offer even the simplest identity protections to individuals and families during the administration’s induced economic downturn is unacceptable.
Since March, roughly 15 million Californians have filed claims for UI benefits. Many were denied or unprocessed, not because of claimant error or lack of need, but because of EDD mismanagement. The agency’s inability to protect the identities of claimants is one of the more troubling and long-lasting problems.
Reports of thousands of individually addressed pieces of mail from EDD containing requests for additional information, confirmation notices, and even UI debit cards loaded with other people’s UI benefits were showing up in the wrong mail boxes. A mismailed letter here or there could be forgiven, but massive amounts of mail not only going to the wrong address, but also arriving at the same location addressed to 40 different individuals reeks of identity fraud. Yet EDD continued to send out critical pieces of mail including sensitive information like Social Security numbers, putting millions of innocent Californians at risk for identity theft.
I supported legislation that would prohibit, after Jan. 1, 2023, any state agency from sending mail containing a person’s Social Security number. However, recent reports of fraudulent activity involving our state’s prisons has made it abundantly clear that we can’t wait. EDD needs to comply with the recommendations set out in the 2019 audit ASAP.
A group of county district attorneys recently warned the governor that an estimated $1 billion in UI benefits has been paid out in fraudulent claims submitted in the name of incarcerated individuals. Fake names like John Doe and Poopy Britches, as well as legitimate Social Security numbers were used to defraud the taxpayers. Preventable? Yes. California is one of only 15 states that does not cross-reference Social Security numbers necessary for EDD applications with state prison records. About five years ago, a former EDD director told the District Attorneys Association that a crosscheck tool existed to prevent this type of fraud, but that check is not happening.
Since Newsom will not fix the EDD, the Legislature must. After all, our offices have been helping thousands of constituents navigate a system that is beyond broken. I look forward to working with colleagues on both sides of the aisle to address many of the agency’s problems, but a good first step is to immediately ensure the identities of individuals applying for unemployment are protected.
Scott Wilk, R-Santa Clarita, represents the 21st Senate District, which encompasses the Antelope, Santa Clarita and Victor valleys.