Local, State and Federal Law Enforcement Collaborate to Protect Californians from Unemployment Insurance Fraud

SACRAMENTO – The Governor’s Office of Emergency Services (Cal OES) in partnership with State’s Districts Attorney’s and the US Attorney’s Office continue to investigate and remediate fraud within state and federal unemployment insurance programs. Under the guidance of this state level coordination group, new safeguards have already been put in place to protect Californians as ongoing investigations continue to move forward in a collaborative fashion.

Established on November 24, the state level coordination group on unemployment insurance fraud – which also includes participation from the Federal Bureau of investigation, the California Department of Corrections and Rehabilitation (CDCR), the California Department of Justice among others – has worked closely with the California Employment Development Department (EDD) to employ new tools and bolster existing programs to strengthen its fraud detection methods. Changes include amplified fraud detection criteria as advised by Thompson Reuters, and a new data sharing system with the state prison system to stop any payments to incarcerated individuals.

“California is committed to making steady progress to swiftly identify and stop fraud that has occurred during the Pandemic within the unemployment benefits system. We thank our local, state and federal partners for their collaborative efforts to date, and we will continue to work in unison with them to protect Californians and to aggressively investigate and bring to justice those responsible for unemployment fraud” said Mark Ghilarducci, Director of the California Governor’s Office of Emergency Services.

“A fraud scheme of this magnitude, involving potentially billions of taxpayer dollars and thousands of fraudsters requires a united law enforcement approach. We have built a team of federal, state and local partners, and We are pleased and proud to work with them to investigate and prosecute the fraud arising out of the pandemic,” said U.S. Attorney McGregor W. Scott. “We have already indicted multiple defendants, and a large number of cases are in the pipeline. The U.S. Attorney’s Office and our partners are committed to the mission of combatting fraud that abuses the provisions of the CARES Act.”

“As Elected District Attorneys and representing District Attorneys across CA, we continue to be concerned about the staggering fraud that has been committed by incarcerated individuals. However, with the collaboration of Cal OES, EDD, CDCR and law enforcement, we’ve made significant progress in addressing this fraud. We remain committed to ensuring that hard working Californians impacted by the pandemic are prioritized in receiving their rightful benefits,” said Anne Marie Schubert, Sacramento County District Attorney and statewide Task Force Leader.

“From the beginning California’s District Attorneys have been concerned that many thousands of those unemployed through no fault of their own are being denied benefits because of a backlog in large part, created by incarcerated convicted criminals attempted to game the system. We appreciate the engagement of Mark Ghilarducci and Tom Osborne at the Office of Emergency Services in this effort as well as that of CDCR and EDD,” said Vern Pierson, President, California District Attorneys Association and El Dorado County District Attorney.

Some of the collaborative efforts of the task force to date include:

  • Establishing a joint executive level multi agency coordination group to facilitate a unity of effort, coordinate actions and streamline statewide investigative efforts.
  • Expanding contract between EDD and Thomson Reuters toapply additional industry standard fraud detection criteria and take action on claims deemed highly suspect or fraudulent.
    • Thomson Reuters/Pondera works with many states and is the vendor recommended by the California District Attorneys.
    • Thomson Reuters’ fraud screen identified 3.5 million existing claims as potentially fraudulent, approximately 1.9 million of these had already been disqualified by EDDEDD took action on December 26 to stop payment on the remaining 1.4 million accounts.
  • Allocating $5 million in state funding to immediately support and enhance the joint investigative efforts of regional District Attorney Task Forces.
  • Establishing a new data sharing agreement which allows the CDCR to more broadly share information with EDD investigators to accelerate cross-matching of inmate data to more rapidly identify fraudulent claims being made by or on behalf incarcerated individuals. It will also help to identify and eradicate any potential fraud within both the state prison system as well as local jail facilities.
  • Working with ID.me to strengthen the EDD identity verification process. Since ID.me was launched in October and an estimated 30% of claims have been stopped by ID.me.
  • Leveraging and sharing multi agency resources to streamline investigative efforts and de-conflict case data across the state to prevent duplication of effort, increase coordination and insure for continued collaboration.
  • Utilizing the State cyber security threat intelligence, big data analysis and threat assessment capabilities to support investigative efforts.
  • Supporting federal, state and local law enforcement in conducting search warrants, indictments and facilitating arrests of fraud perpetrators.
  • Increasing collaboration by incorporating regional investigative task force efforts into state level coordination.

The State level coordination taskforce was created at the Direction of Governor Gavin Newsom, who directed Cal OES to facilitate the joint efforts, with District Attorneys and the US Attorney’s Office of multiple local, state and federal law enforcement entities to hold those responsible for PUA/UI accountable to fullest extent possible under the law.

The full list of organizations participating in this effort includes: California Governor’s Office of Emergency Services (Cal OES), California Highway Patrol (CHP), California Attorney General’s Office (CADOJ), the California District Attorneys Association, United States Department of Labor-Office of the Inspector General, Federal Bureau of Investigation (FBI), United States Secret Service (USSS), US Attorney’s Office, United States Marshalls Service, Federal Bureau of Prisons, California Department of Corrections and Rehabilitation (CDCR) and the California Employee Development Department (EDD).

9 Comments

  1. Anonymous

    So, suspending probably hundreds of thousands of non-fraudulent claims and keeping money out of the hands of Californian’s who are now going hungry and missing bill payments was the right solution to this?

    My claim was suspended for potential fraud as a part of this bs and I was told both in writing and on the phone that I would receive more information today. It’s been almost a month since I was paid last and I’m almost out of food. I’ve missed a credit card payment and my tuition is due in less than a week, so I’ll probably have to miss this semester and delay my graduation. I didn’t commit fraud. What about people like me, what are we supposed to do?

    Reply
  2. Christina

    So we’re in “EDD LIMBO”?? My rent is due! I live in Riverside County, where the pandemic is a wild fire. I follow the rules, quarantine, stay home, only go out for absolute necessities, wear your mask, wash your hands, and social distance… to end up homeless?? My unemployment claim is not fraud, yet I suspect… For what??? I have a family!! How are we to survive?? My car is gone now, couldn’t afford registration, or insurance because I cannot go back to work per the state and federal government! So now what Governor News on?? Now what??

    Reply
    • Anthony Phillips

      My story is so dam similar to yours except I’ve been evicted smh

      Reply
  3. Anthony Phillips

    Back in NOVEMBER my girlfriend and I were evicted All thanks to this fraud and freezing EDD accounts. It has ruined my life!!! I had to sell my car just so I can keep living in a Motel 6 this month. Now I literally have nothing to fall back on. Idk what to do now but continue and hope this problem gets solved soon and quick.

    Reply
    • Anthony J Phillips

      It’s April and still not a penny from the EDD now living at a park….

      Reply
  4. Ryan k

    This is such bull my wife has been waiting for her extended payments to start since the school where she works with mentally challenged kids was shut down and went through all her unemployment benefits now she had to take a job working 8-10hr a week which doesn’t even cover food for a week. We need that money to survive its hard enough feeding a family of 3 on one income but having to pay all the bills alone is almost impossible. We are living off our credit cards but even those are almost maxed out. We need the EED to fix this and fix it quick!!!

    Reply
  5. Kathleen

    It just breaks my heart to see how many people are struggling so much through no fault of their own, but a system that really has had some major problems handling/managing this whole UI business. One of the things that occurs to me is that their are people who are “seasonal workers” who file regularly for unemployment and that should already be noted within EDDs filing system but even if it’s not, it should be fairly obvious that they are indeed a “seasonal worker” who gets laid off regularly with the promise to resume when the workload resumes. There must be codes EDD uses for employers who have seasonal workers that would tag those folks as such and when they file a claim, it should be obvious they are eligible and needn’t go through the ID.me identity process. In spite of the number of fraudulent claims they are stopping, they are still creating a backlog for easily identifiable legit workers who are unemployed strictly due to the pandemic.. Like people who work in any education system. Sure they have ramped up their efforts by hiring more people and extending their hours. but everywhere you turn there is another story of someone waiting weeks and/or months to get paid and some are losing their homes due to it so the matter is not under control yet. I am very grateful my pay is no longer being held up and I am grateful to all the workers who are doing their best at EDD and yet they have been asked to take a cut in pay from their normal pay scale.

    Reply
  6. RESP Calgary

    This is a great article and you are banged on with your points about top 18 online financial advisors in 2020. Be clear about what you really need and want to accomplish at this point- you are right with this point.

    Reply
  7. B G

    My mother-in-law has been lied to since her benefits were turned off for months… finally someone at Edd told her today that her account had been “flagged” and forwarded to what she called “Thomson Reuters” and that it was “out of EDD’s hands now”… and that to “call your assemblyman’s office”

    What the f*ck is going on?

    Reply

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