California says 350,000 unemployment benefit debit cards frozen

Confronted with a deluge of fraudulent unemployment claims, California officers stated Thursday that 350,000 of the debit playing cards they issued containing advantages have been frozen due to suspicious exercise, together with a excessive variety of claims at a single tackle.

The debit playing cards frozen by the state Employment Improvement Division and Financial institution of America may signify billions of {dollars} in advantages paid out for the reason that COVID-19 pandemic started in March.

“The Division’s high precedence is to rapidly confirm the id of any claimants on this group that will have been impacted by scammer assaults, whereas we work to close down the possibly fraudulent claims,” the company stated in a press release Thursday.

The scope of the potential fraud has alarmed some state officers. However Assemblyman David Chiu (D-San Francisco) stated he’s additionally involved that individuals in determined want of unemployment advantages are additionally seeing their legitimate claims held up.

“Our workplaces have been listening to complaints from constituents with respectable claims who’ve had their EDD debit playing cards frozen as part of this fraud prevention measure,” Chiu stated. “Once more, EDD appears unable to handle fraud with out harming Californians who’re relying on them for advantages.”

EDD officers didn’t reply Thursday to questions on how a lot cash in advantages is affected by the frozen debit playing cards.

Legislation enforcement officers who’ve arrested greater than 100 individuals for unemployment fraud have stated the debit playing cards they seized potentially contained up to $20,000 in benefits each. If that quantity was on every of the 350,000 frozen playing cards, that may signify $7 billion of the $105 billion in advantages paid out by the EDD for the reason that pandemic started.

The EDD stated it’s sending notices to claimants whose debit playing cards have been frozen asking them to supply id verification paperwork by way of the company’s web site.

Claimants who don’t confirm their id can be disqualified from receiving advantages.

Individuals who haven’t been notified by EDD however nonetheless can’t entry their funds might have had their playing cards frozen by Financial institution of America, the issuer of the playing cards, “due to a suspected transaction,” and they need to contact the financial institution, the company stated. A spokeswoman for Financial institution of America declined remark.

The company stated its investigators “are busy working with nationwide, state, and native companions to reveal, establish, and prosecute offenders to the fullest extent of the legislation.”

Assemblyman Jim Patterson (R-Fresno) stated certainly one of his constituents is a homeless mom of three younger women who has spent weeks making an attempt to confirm her id on her respectable declare for unemployment advantages.

“The EDD nonetheless doesn’t know the distinction between scammers and people in determined want — just like the 30 shoppers at a midway dwelling in my district who all had their playing cards shut off,” Patterson stated.

In the meantime, the EDD has additionally faced criticism that individuals calling in to a few separate company name facilities haven’t been capable of attain a service consultant or get assist with stalled claims.

In response, the company stated that beginning Friday it’s combining its three name facilities into one out there between eight a.m. and eight p.m., seven days every week.

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