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A Scathing Week Of Audits For California's Beleaguered Unemployment Office

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Image from State Audit
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It's been a scathing week of audits for California's Employment Development Department. On Tuesday, a state audit found the agency wasted 10 years after the Great Recession failing to plan for the next recession and that led to widespread delays for jobless Californians getting payments during the pandemic.

Today, a report from state auditor Elaine Howle found EDD's fraud prevention approach was marked by "significant missteps and inaction.”

Howle said the department ignored repeated warnings to strengthen its fraud detection efforts until months into the pandemic, resulting in $10.4 billion dollars in fraudulent jobless claims. The report also says EDD was unprepared to prevent claims filed under the names of inmates, which totaled $810 million. The department also failed to prevent claims coming from suspicious addresses. In one case, more than 1,700 claims came from a single address.

Another important note from the audit: in the first four months of the pandemic, the agency had just two people in charge of reviewing and stopping suspicious claims. On some days, as many as 1,000 claims needed more scrutiny.

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