By ADAM BEAM – Associated Press
Sacramento, California (AP) – The administration of California Gov. Gavin Newsom wants to pay tens of millions of dollars this year so the state can continue to use sophisticated software to prevent fraudsters from claiming false unemployment and stealing money from taxpayers.
However, the non-partisan body of the Legislative Council, which advises the legislature, said it should reject Newcom’s proposal, citing the fact that most fraudulent claims make it difficult for legitimate claimants to get paid.
Nancy Faris, who was appointed director of the California Department of Employment Development, told lawmakers Tuesday that the state has stopped $ 120 billion in fraud attempts in 2020 and 2021 – or more than $ 164 million a day.
The state has not been able to stop the $ 20 billion fraud, including the $ 810 million paid for the ineligible 45,000 inmates. In particular, he paid money in the name of identity theft in the name of Scott Peterson. So far, the department has 850 pending investigations into fraud and more than 200 have been arrested, Faris said. About 20 cases have been filed.
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But almost all of that fraud is a temporary federal program that qualifies many people for unemployment benefits at the time of the outbreak. That program, which did not have much protection like the traditional unemployment benefits process, ended.
“This is not a threat to the state,” said Chas Alamomo, an analyst with the Legislative Office.
The state’s crackdown on fraud has created a problem for legal claimants. In December 2020, the state used software owned by Thompson Reuters subsidiary to assess nearly 10 million unemployment claims. The state then abruptly cut off benefits to 1.1 million claims, forcing people to verify their identities with the state.
But 600,000 or more of these claims have been legalized. When trying to resolve issues with the state, people had to leave for days or weeks without pay.
Alamo told lawmakers on Tuesday that if the state allowed those anti-fraud agreements, it would “move the department in the wrong direction by eliminating fraud at the department’s expense by paying immediate and direct benefits to the unemployed.”
But Faris, who was appointed director of the Department of Employment Development last month, said everyone assumed “identity theft has continued and is indeed continuing.”
“Everyone I know suffered from fraud during the epidemic,” says Farias. “I think the fraud is over now. I think that’s a little dangerous.
The state uses facial recognition software in conjunction with artificial intelligence to verify people’s identities. According to the Legal Analyst’s Office, this software is fraudulent, subjected to racial discrimination, and misused. It was enough to ask the IRS to stop using face recognition software for taxpayers.
Lawmakers did not make a decision Tuesday. They have until June 15 to approve the state budget. But some members of the congregation, like Democrat Jim Cooper of Elk Grove, seemed to support the deal.
“It was the biggest fraud in the country’s history,” he said. “Unusual times require unusual methods.”
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