Wilk demands answers to draining of EDD accounts

In the ever-growing debacle at the Employment Development Department (EDD), and Governor Newsom’s mishandling of the situation from day one, Senator Scott Wilk, representing the 21st Senate District and more than 50 other lawmakers are demanding answers from Bank of America surrounding the agency’s latest problem – the freezing and draining of EDD accounts.

The press reports at least 350,000 Californians are currently unable to access UI, PUA and SDI benefits owed to them. That said EDD is unsure of the exact number, as they state they only receive data from Bank of America after cards are frozen. EDD also informs us that less than 8% of debit card cases have been resolved.  The bipartisan letter submitted to Bank of American Chairman and CEO Brian Moynihan last week requests answers to specific questions surrounding this decision.

“EDD’s mismanagement has made it incredibly hard for millions of Californians to access unemployment benefits this year. Everything the Governor has done is a day late and a dollar short. After he put millions of people out of work, he should have prioritized fixing the problems at EDD as soon as they were called to his attention but he didn’t,” said Wilk. “This is another kick in the face to people worried about where their next meal will come from. My office has been working 24/7 to help people but at some point there is only so much you can do when it is so screwed up.”

Last month a group of California’s District Attorneys sounded the alarm on the depth of the unemployment scams at EDD stating it could be “the most significant fraud on the taxpayers in California’s history.” In an effort to clamp down on fraud, EDD universally froze thousands of EDD debt cards – including those belonging to legitimate claims, and Bank of America, has drained their accounts, leaving many Californians with nothing to sustain them while this is being sorted out. Governor Newsom’s response:  create another “task force to coordinate state efforts” on the fraud. Newsom’s response this summer to the escalating – and embarrassing - debacle at EDD was also to create a task force.

Link to the letter: https://wilk.cssrc.us/sites/default/files/201201_BofA-Letter.pdf


In April, Wilk and other legislators warned Governor Newsom about the failures of the EDD after hundreds of thousands of jobless Californians reached out to legislative offices seeking help with their unemployment claims. Click here to read April EDD letter.

In June, Wilk and colleagues asked for an independent audit of the EDD through the Joint Legislative Audit Committee (JLAC). Democratic members of JLAC canceled a crucial hearing in August, which would have been an opportunity to review the EDD audit request. Signed by Republican members from both the Assembly and Senate, the letter to JLAC is a bicameral effort to demand answers from EDD. Click here to read the JLAC letter.

In July, Senators Wilk and Melissa Hurtado (D- Porterville) sent a letter to Governor Newsom asking that he staff EDD 24/7 to help clear the backlog.  Click here to read the Wilk/Hurtado letter.

In August, a bipartisan coalition of legislators delivered another letter to the Governor demanding that he take action to improve EDD operations. Click here to read August EDD letter.

In August, San Mateo Sheriffs arrest 21 people on massive unemployment fraud scheme using inmates.

In September, members of JLAC approved an audit of the EDD. Click here to read JLAC approval letter. 

In October, EDD unilaterally freezes 350,000 debit cards because of a variety of fraud indicators, including a high number of claims at a single address. It wasn't clear how much the debit cards were worth, but law enforcement officials say they've uncovered fake cards amounting to $20,000 each.

In late November, District Attorneys announced a major fraud scheme operating in and around California’s prisons projecting at least $140 million dollars has been paid out to some inmates and their accomplices, so far. In December that estimate jumped to $1 billion.