The agency even paid fraudulent claims to death row inmates.

At your request: This week's California Commentary by Jon Coupal
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** California Commentary
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** There's no excuse for the disaster at the EDD
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By Jon Coupal and Kevin Faulconer

We are almost a year into the pandemic, and Californians continue to struggle.

Small businesses, especially restaurants, have suffered steep losses; many have permanently closed. An estimated 1.7 million Californians remain unemployed and over 150,000 Californians remain homeless.

Even before the pandemic, roughly one-third of California residents lived at or near the poverty line.

Job losses due to the lockdown have only swelled the ranks of those struggling to pay bills for housing and utilities and who now must rely on food banks just to survive.

Meanwhile, under Gov. Gavin Newsom’s watch, the Employment Development Department (EDD) failed to process a backlog of claims for hundreds of thousands of unemployed Californians while sending out between $11 billion and $31 billion in unemployment benefits for phony claims that included payments to organized crime rings in Nigeria, China, and Russia.

The agency even paid fraudulent claims to death row inmates.

Given California’s feckless political leadership, combined with breathtaking incompetence at the EDD, it is no wonder that international criminals seized the opportunity to steal billions of dollars in unemployment benefits meant for struggling Californians.

As the crisis grew, EDD shuttered its doors and left phones unanswered. The agency called it a “reset” in September when it refused to accept new claims for two weeks.

The state government had plenty of forewarning about the problems. In May 2020, the United States Secret Service alerted EDD that organized criminals were exploiting weaknesses in their systems to steal taxpayer monies. But despite additional warnings from the FBI, the U.S. Department of Labor, the Beverly Hills Police, local district attorneys, and thousands of citizens who filed reports of suspected fraud at the EDD’s online portal, Gavin Newsom did nothing to tackle the widespread vulnerabilities.

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Jon Coupal is the President of the Howard Jarvis Taxpayers Association (HJTA). He is a recognized expert in California fiscal affairs and has argued numerous tax cases before the courts.
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