California officials blasted the Trump administration’s plans to launch a full-sale investigation into unemployment fraud as ”purely political” — and blamed lost money on the feds.
The US Department of Labor intends to send a “strike team” to dig into COVID-19 pandemic-era fraud involving California’s Employment Development Department, The Post exclusively reported Wednesday.
California is believed to have lost as much as tens of billions of dollars in fraudulent unemployment payouts.
Labor Secretary Lori Chavez-DeRemer said the Biden administration “turned a blind eye” to stolen money and vowed to fully examine the scope of theft that occurred early in the pandemic.
“This ends now,” Chavez-DeRemer said.
EDD officials told The Post they have already taken numerous efforts to combat fraud, launching more than 2,300 investigations and securing 670 convictions with the help of Fraud Special Counsel McGregor Scott, a former US attorney.
“The Trump administration’s announcement today is purely political,” an EDD spokesperson told The Post by email.
“The fraud referenced is the result of a program poorly designed by the federal government, which created fraud at a nationwide scale.” --->READ MORE HERE
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| Tayfun Coskun/Getty Images |
Labor Secretary Lori Chavez-DeRemer says 'previous administration turned a blind eye toward failing Labor programs'
The Labor Department deployed a "strike team" to California to address federal findings of improper payments and alleged fraud within the state’s unemployment insurance (UI) program.
California has been found to have a depleted UI trust fund, along with $21 billion in borrowed federal funds to keep the system running, which federal officials say has led state employers to pay higher UI taxes to repay the debt.
In a statement, the department cited an 83-page California State Auditor report that determined the state’s UI system is high-risk in part due to "inadequate fraud prevention and claimant service [in its employment development department (EDD)], as well as a high rate of overturned eligibility decisions in its Unemployment Insurance Program."
"Financial issues and potential fraud in California’s unemployment insurance program will be fully examined. The previous administration turned a blind eye toward failing Labor programs. This ends now," Labor Secretary Lori Chavez-DeRemer said.
"Immediately, we are engaging a specialized strike team to uncover any potential fraud or abuse and quickly moving to protect the American worker and taxpayers. I look forward to restoring the California UI program’s integrity and financial health."
Chavez-DeRemer added that the "strike team" will include Labor Department specialists from both its national and regional offices.
The secretary also wrote a letter to the EDD, citing increasing improper payment rates, insufficient timeliness, data accuracy and quality concerns and questions about participants’ eligibility and the use of taxpayer funds. --->READ MORE HERE
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