{"id":2017488,"date":"2023-08-30T22:18:04","date_gmt":"2023-08-31T02:18:04","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/californias-employment-department-listed-as-high-risk-by-state-auditor-after-losing-20-billion-to-fraud\/"},"modified":"2023-08-30T22:25:49","modified_gmt":"2023-08-31T02:25:49","slug":"californias-employment-department-listed-as-high-risk-by-state-auditor-after-losing-20-billion-to-fraud","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/californias-employment-department-listed-as-high-risk-by-state-auditor-after-losing-20-billion-to-fraud\/","title":{"rendered":"California&#8217;s Employment Department labeled &#8216;high risk&#8217; by state auditor due to $20 billion lost to fraud."},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">32<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fcalifornias-employment-department-listed-as-high-risk-by-state-auditor-after-losing-20-billion-to-fraud%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2017488&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div data-post-content=\"true\" class=\"post_content\" id=\"post_content\">\n<h2>California\u2019s \u200cEmployment Department Listed as &#8220;High-Risk&#8221; Agency<\/h2>\n<p>California\u2019s employment department, which provides job services and unemployment aid to\u2062 thousands of Californians each year, has been listed as a \u201chigh-risk\u201d agency, according to a state <a href=\"http:\/\/auditor.ca.gov\/reports\/2023-601\/index.html#EDD\" target=\"_blank\" rel=\"noopener\">audit<\/a> released Aug. 24.<\/p>\n<p>The Employment Development Department \u2062(EDD) made the <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/sen-paul-says-agencies-refusing-to-provide-information-on-us-funding-of-risky-research-in-china\/\" title=\"Sen. Paul Says Agencies Refusing to Provide Information on US Funding of Risky Research in China\">high-risk list<\/a> because of its inadequate\u200b fraud \u200bprevention and claims services,\u2062 and a high rate of overturned eligibility decisions in its unemployment\u2064 insurance\u2064 program, California\u2063 State Auditor Grant Parks found.<\/p>\n<blockquote>\n<p>\u201cEDD is a \u2062high-risk agency because of its mismanagement \u2064of the [Unemployment Insurance] program,\u201d Mr. Parks wrote in the report. \u201cSpecifically, EDD is unable to reliably estimate improper payments under the [Unemployment Insurance] program, thus \u200cadversely affecting the State\u2019s financial statements as well as impairing efforts to independently \u200bevaluate the efficacy of EDD\u2019s\u200c own fraud prevention\u200c activities.\u201d<\/p>\n<\/blockquote>\n<div class=\"shortcode\">\n<div class=\"border-comp-divider mb-4 mr-4 w-full max-w-[500px] border px-5 py-4 text-[16px] leading-[20px] text-[#262626] md:float-left\">\n<div class=\"mb-3 font-sans text-[16px] font-semibold uppercase leading-[19px] text-[#2F2F2F]\">Related Stories<\/div>\n<ul>\n<li>\n<div class=\"mb-1 line-clamp-2\"><a href=\"http:\/\/www.theepochtimes.com\/us\/californias-unemployment-insurance-trust-fund-is-now-structurally-insolvent-under-weight-of-pandemic-loans-5385670\">California&#8217;s Unemployment Insurance Trust Fund Is Now &#8216;Structurally Insolvent&#8217; Under Weight of Pandemic Loans<\/a><\/div>\n<div class=\"text-comp-caption text-[14px] leading-[18px]\">7\/11\/2023<\/div>\n<\/li>\n<li>\n<div class=\"mb-1 line-clamp-2\"><a href=\"http:\/\/www.theepochtimes.com\/us\/california-defaults-on-18-6-billion-debt-now-businesses-have-to-pay-5246637\">California Defaults on $18.6 Billion Debt, Now Businesses Have to Pay<\/a><\/div>\n<div class=\"text-comp-caption text-[14px] leading-[18px]\">5\/5\/2023<\/div>\n<\/li>\n<\/ul><\/div>\n<\/p><\/div>\n<p>The department needs to improve \u2064customer service for residents seeking unemployment insurance and take steps to ensure its \u200deligibility\u200d decisions are\u200d not frequently \u200coverturned on appeal, Mr. Parks added.<\/p>\n<p>Additionally, according to Mr. Parks, the employment \u200bdepartment\u2019s \u200cmismanagement of its <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/joe-bidens-choice-to-oversee-covid-unemployment-benefits-lost-600-million-in-coronavirus-relief-to-nigerian-scammers\/\" title=\"Joe Biden\u2019s Choice To Oversee COVID Unemployment Benefits Lost 0 Million In Coronavirus Relief To Nigerian Scammers\">unemployment insurance program<\/a>\u200d has resulted in a \u2063\u201csubstantial risk\u2063 of serious detriment\u201d to the state and its residents.<\/p>\n<p>In the\u2063 report,\u200c the state auditor also found the \u2062EDD had not \u200btaken\u200c adequate steps \u200bto prevent improper denials of unemployment benefits, citing that about half of the appeals claimants filed between 2017 and 2022 were \u200doverturned in their favor.<\/p>\n<div class=\"shortcode\">\n<div class=\"lazyload-wrapper\">\n<div class=\"lazyload-placeholder\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>Also, the EDD\u2019s customer service during the pandemic resulted in\u200d millions of Californians waiting long periods of time\u200c to get their benefits or get answers to questions about their\u200d claims, and the department continues to struggle to pay\u200b claims\u200c in a \u2064timely manner, the auditor reported.<\/p>\n<p>Between January and\u200d May this year, people called the department,\u2064 on average,\u2063 between\u2064 three and eight times a week to try to get help on claims, Mr. Parks said.<\/p>\n<p>The State \u200dAuditor\u2019s Office additionally recommended the EDD allow it \u2064to perform a\u2063 high-risk\u2062 audit of its systems to help identify fraudulent or improper claims \u200cand \u200bdevelop\u2063 recommendations.<\/p>\n<p>The management\u2063 of COVID-19 funds \u200bcontinues \u200cto\u2064 present a \u2063significant\u2062 risk to California and its residents, according to Mr. Parks.<\/p>\n<h2>Only $2 Billion \u200bRecovered From Fraud<\/h2>\n<p>At least 14 state agencies have received pandemic funds since 2020 and the EDD was one of the largest recipients\u2064 using a significant portion\u200c to <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/california-lawmakers-introduce-legislation-to-give-unemployment-benefits-to-illegal-aliens\/\" title=\"California Lawmakers Introduce Legislation to Give Unemployment Benefits to Illegal Aliens\">provide unemployment benefits<\/a>.<\/p>\n<p>However, during the COVID-19 pandemic crisis, the EDD reported massive fraud as unemployment\u2063 claims \u2062skyrocketed. The\u2064 agency estimated it paid out <a href=\"https:\/\/apnews.com\/article\/business-california-5ec16ebe5b5982a9531a7a3d5a45e93c\" target=\"_blank\" rel=\"noopener\">about $20 billion<\/a> in unemployment \u200dto domestic \u2063and international criminals, according to The Associated Press.<\/p>\n<p>So far, only $2 billion in stolen\u2062 funds has been recovered, an EDD spokesperson told The\u200c Epoch Times in an email.<\/p>\n<p>The \u200cstate <a href=\"https:\/\/www.theepochtimes.com\/us\/california-unemployment-fraud-estimated-to-reach-10-billion-3660072\" target=\"_blank\" rel=\"noopener\">reported<\/a> funds stolen between March and September 2020 went \u2062to foreign crime \u2063organizations that <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/swing-district-dems-break-from-biden-on-increased-unemployment\/\" title=\"Swing-District Dems Break From Biden on Increased Unemployment\">filed unemployment claims<\/a> with stolen \u2064identities and used \u201cmoney mules\u201d in the United States to pick \u2062up the debit cards sent\u2063 out by the employment \u200ddepartment.<\/p>\n<p>Additionally, hundreds \u2064of millions of\u200c dollars\u200b in unemployment payments went to prison and jail inmates, many of whom weren\u2019t held in\u2062 California, according to a law enforcement <a href=\"https:\/\/news.caloes.ca.gov\/local-state-and-federal-law-enforcement-collaborate-to-protect-californians-from-unemployment-insurance-fraud\/\" target=\"_blank\" rel=\"noopener\">task force<\/a> \u2062 led by the state\u2019s district attorneys.<\/p>\n<p>Part of \u2062the \u200bproblem arose because the department\u2019s unemployment\u2064 program did not block addresses that \u2064filed high numbers\u2064 of \u200dclaims, and the EDD removed a safeguard\u2064 preventing payment to those who had unconfirmed identities, according to the state audit.<\/p>\n<p>The EDD, however, pointed out the department\u200d took several actions to combat fraud when identity\u200b thieves attacked new federal benefit programs nationwide during\u200c the pandemic, according to an EDD statement to\u200b The Epoch Times.<\/p>\n<p>In October 2020, the\u200d department implemented new identity verification\u200c techniques, including \u2063the use \u200bof\u2064 <a href=\"https:\/\/www.id.me\/\" target=\"_blank\" rel=\"noopener\">ID.me<\/a>, a <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/californias-employment-department-listed-as-high-risk-by-state-auditor-after-losing-20-billion-to-fraud\/\" title=\"California's Employment Department labeled 'high risk' by state auditor due to  billion lost to fraud.\">secure digital online identity network<\/a>.<\/p>\n<p>\u201cThese have all worked well \u2064for us,\u201d the\u2064 EDD\u2019s spokesperson said.<\/p>\n<div>\n<figure style=\"width:600px\" class=\"alignnone\"><figcaption>California&#8217;s Employment Development Department paperwork in \u200cIrvine, Calif., on April 2, 2021. (John Fredricks\/The Epoch Times)<\/figcaption><\/figure>\n<\/p><\/div>\n<p>The department\u2019s\u2063 director, Nancy Farias, additionally pushed back against its high-risk designation, saying the COVID-19 pandemic overwhelmed every state unemployment insurance system in the\u2064 country and all were impacted by fraud.<\/p>\n<p>The department\u200d has made several significant changes\u200d since then, \u2064however, and has implemented\u2063 internal fraud prevention measures, stopping nearly $43.5 \u2064billion in fraudulent payments from being made, Ms. Farias wrote in \u2064a\u200b response letter.<\/p>\n<p>\u201cEDD has accomplished significant\u200c advancements in fraud detection and\u2064 prevention through transformative policy and program changes, \u2063new tools and technology, \u200dand vital public-private partnerships,\u201d \u200dMs.\u2064 Farias \u2062wrote\u2062 in\u200b the letter.<\/p>\n<p>State Auditor Mr. Parks responded to the EDD\u2019s statement, saying the department \u200bstill cannot effectively measure the impact of steps it has taken to prevent fraud becau<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>California&#8217;s Employment Development Department (EDD), responsible for job services and unemployment aid, has been deemed a &#8220;high-risk&#8221; agency due to insufficient fraud prevention, claims services, and a high rate of overturned eligibility. This state audit, released on Aug. 24, highlights the need for improvements in the department&#8217;s operations.<\/p>\n","protected":false},"author":242,"featured_media":2017489,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[543],"tags":[],"class_list":["post-2017488","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-epoch-times"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2017488","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/242"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2017488"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2017488\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2017489"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2017488"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2017488"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2017488"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}