(The Center Square) – The California Employment Development Department (EDD) announced on Tuesday this week that it has recovered $1.1 billion in unemployment insurance funds.
The state found the funds on inactivated benefit cards. Although the state found the money, most of it will return to the federal government. That’s because the fraudulent claims are primarily from the emergency federal Pandemic Unemployment Assistance program.
California hired McGregor Scott as EDD Fraud Special Counsel in July 2021. In this position, Scott “aids the state’s work with law enforcement to combat fraud—including supporting state, federal, and local investigations and prosecutions,” according to California Governor Gavin Newsom’s office.
“We will continue working with law enforcement to put fraudsters behind bars and recover every stolen dollar that we can,” Scott said in the press release.
Newsom’s office says the billion-dollar recovery furthers the state’s efforts to investigate and prosecute criminals who defrauded federal emergency unemployment benefit programs.
Over the past 15 months, the state has had at least 1,525 investigations, 467 arrests, 162 convictions, and $3,474,448 seized from these fraudsters.
The recovered amount pales in comparison to a January 2021 estimation from state Auditor Elaine Howle that fraudsters took at least $10.4 billion in taxpayer dollars.
EDD manages one of the largest public benefits systems in America. In the past decade, over 20 million people filed over 60 million unemployment, disability insurance, and paid family leave claims using it. During the height of the coronavirus pandemic, the department was mailing nearly 600,000 documents a day, according to Newsom’s office.