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Salas introduces bill to reform California’s EDD amongst fraud case

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Posted at 4:33 PM, Dec 07, 2020
and last updated 2020-12-07 19:33:19-05

SACRAMENTO, Calif. (KERO) — Assemblymember Rudy Salas, D-Bakersfield, introduced Assembly Bill 56, which will overhaul the Employment Development Department, to speed up and simplify unemployment insurance claims, protect Californians from identity theft, stop rampant fraud of the unemployment insurance system, and hold the department accountable if they do not deliver benefits in a timely manner.

In late November, it was reported that prosecutors across the state believed an estimated $1 billion of pandemic unemployment money may have been sent to inmates across California in what's being described as the biggest taxpayer fraud scheme in the state's history.

This grievance landed the EDD in some hot water as investigators confirmed more than 20,000 unemployment claims filed under the names of inmates in California jails and prisons were paid out between March and August with more than $140 million sent their way.

“California families are suffering and need immediate relief from the EDD,” said Assemblymember Salas. “Common sense solutions are needed to resolve widespread issues and help working families put food on the table and make it through the current crisis. AB 56 will help protect taxpayers, create accountability, and move the state forward by reforming the EDD. We must ensure that California families are put first and receive the assistance they need during these tough times.”

How does this affect Kern County?

In Kern County, District Attorney Cynthia Zimmer said over 4,000 fraudulent applications were filed from correctional facilities in the county. Of those, 2,500 of those claims were paid out totaling about $16 million.

AB 56 seeks to address the many issues plaguing the EDD that have negatively impacted working families throughout California. Among these issues, the EDD’s identity verification system faces delays while California still has a backlog of more than half a million unemployment insurance claims.

The state also faces an uphill battle to curb fraudulent activities. According to reporting, the EDD “paid more than 35,000 claims under state prisoners’ names. Of the 35,000 statewide unemployment claims that have been filed, around 20,000 were paid out and the state has paid out at least $140 million in benefits. At least 158 claims have been filed for 133 inmates on death row.

AB 56 would fix these issues by requiring the EDD to implement changes to its identity verification system to make the process more efficient, create a plan to stop mailing full SSNs to individuals, and would provide Californians with the option to have their unemployment insurance benefits deposited directly into their bank accounts.

Additionally, the bill would require the EDD to crosscheck the names of new claimants with the Department of Corrections and Rehabilitation to ensure that benefits are not sent to incarcerated individuals.

Lastly, AB 56 would hold EDD accountable by instituting penalties if the department does not deliver assistance in a timely manner