Congress is Fed up with the California EDD

EDD Shines Congress On…Yet Again

Thanks to the California Globe for running this piece. You can visit the website at: https://californiaglobe.com/

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Congress is getting fed up with the EDD, Wednesday sending a third request for information regarding its disastrous fraud-riven, pandemic response.

In January, the House of Representatives Oversight and Accountability Committee asked EDD chief Nancy Farias to turn over a series of internal documents as part of the committee’s investigation into the pandemic response fraud.

Farias responded with a letter ludicrously blaming - https://californiaglobe.com/articles/california-edd-blamed-fed-program-for-fraud-new-numbers-show-that-is-impossible/ - former President Donald Trump for the $40 billion the EDD lost to fraud; however she did not send over any of the request documents.

The committee tried again and the EDD sent back another letter and some press releases – not even remotely properly responding to the request.

Now, the committee seems a bit peeved, especially in light of the upcoming Senate vote on the confirmation of Julie Su to be the next Secretary of Labor.  Su led the EDD during the pandemic as it negligently shoveled out billions of dollars to fraudsters while simultaneously failing to pay benefits to millions of legitimate claimants.

“The Oversight Committee’s mission is to have the backs of American taxpayers and prevent waste, fraud, abuse, and mismanagement of taxpayer dollars,” said House Committee on Oversight and Accountability Chairman James Comer (R-Ky.) “We owe it to the American people to get answers about how California’s negligence allowed tens of billions of taxpayer dollars to be lost to fraud, especially as President Biden is trying to appoint Julie Su as the next Secretary of Labor. Giving a taxpayer dollar arsonist a bigger match will only lead to a bigger fire.”

The EDD did not respond to a request for comment.

The committee is attempting to get to the bottom of the massive fraud perpetrated against the EDD during the pandemic. The current estimate is that the EDD lost about $40 billion to illegitimate claimants, including prisoners (and not just from California prisons,) garden variety local scammers, and international fraud rings, all of whom simply walked right into the department’s completely unprotected system.

While the EDD has claimed it did the best it could, it should be noted that the EDD – even though it could have purchased basic fraud protection software that would even work with its antiquated IT systems for about $5 million-  had no way to prove if an applicant was who they said they were until the end of 2020, months after the pandemic began.

The committee has asked the EDD, which it characterized as being “plagued by rampant waste, fraud and abuse” for the following documents and information:

1. All processes and procedures related to the disbursement of unemployment insurance benefits during the pandemic, including policies and procedures intended to ensure payments are made to the proper individual, and to ensure that the individual is a qualified recipient of unemployment insurance;

2. All documents and communications between employees of the California EDD and employees of the U.S. Department of Labor regarding the state’s UI benefit program;

3. All documents and communications related to efforts to prevent payment of fraudulent UI claims;

4. All documents and communications related to efforts to recoup UI claims paid improperly; and

5. All documents and communications related to identifying the total number of improperly paid UI benefits and documents sufficient to show whether those funds remain in the United States or were transferred to entities outside the United States.

As the EDD failed to respond to a request for comment, it is not exactly clear why the agency is failing to comply with a congressional oversight effort (though readers are invited to speculate.)

The committee has given the EDD until May 10 to comply with the request.  The committee would neither confirm nor deny the possibility of issuing subpoenas and/or conducting its own on-site discovery effort if the EDD fails for a third time