California unemployment: EDD addresses improvement strategies, tax confusion

The EDD's first strategy is to "add operations and governance," noting it has begun hiring 900 new staff members to work in EDD's overwhelmed call centers.
SACRAMENTO, Calif. -- The California Employment Development Department held a phone press conference on Thursday to update the public on the beleaguered agency's efforts to improve their service to unemployed Californians, and to better prevent rampant fraud.

Joined by Deputy Director Loree Levy, the EDD's newly-appointed director, Rita Saenz, opened with a prepared statement outlining five key strategies for improvement.

The EDD's first strategy is to "add operations and governance," with Saenz noting that it has begun hiring 900 new staff members to work in EDD's overwhelmed call centers.

In its continued effort to fight fraud, EDD has also added Accenture, a professional services company, to its list of partners. Accenture will help "to evaluate fraud detection and prevention operations," as the EDD said in a Feb. 14 tweet. Accenture joins current consultants and Thomson Reuters.

Sharing some "initial successes" in their fight against fraud, Saenz said that the EDD had stopped printing claimants' full Social Security numbers on the two highest-volume EDD documents mailed out to claimants, a recommendation made by the California State Auditor back in March 2019 -- a vulnerability seen as contributing to identity theft and false unemployment claims.

RELATED: California unemployment: Thousands of fraud victims get income tax bill for jobless benefits paid to scammers

The EDD's third strategy is to "leverage modern technology to respond to the demands placed on EDD systems to make our system more efficient, and to serve the public better." As an example, Saenz touted improvements to their online "backlog dashboard" that highlights updated data on how many claims are stuck in processing.

Saenz also confirmed that California is working with the federal government and other states to address the fraud within the Pandemic Unemployment Assistance (PUA) program, which, during a previous EDD conference, was said to be the source of 90% of all unemployment fraud. "I believe a coordinated federal response will improve each state's ability to fight fraud and address these problems on a national scale," Saenz said.

The fifth and final strategy, according to Saenz, is for the EDD to put "protocols and procedures in place to hold EDD accountable to the recommendations in the state auditor's report" that came out in late January. Saenz said the EDD would "build additional accountability" into the EDD's operations and culture, including increasing communications with claimants and the media.

RELATED: Thousands of Californians face more delays in getting unemployment benefits

A new source of frustration being addressed by the EDD is the tax forms sent to claimants so that they can pay appropriate taxes on their benefits -- however, some Californians are receiving forms for benefits they never received. Although Saenz noted there were new resources available for taxpayers to learn more about their 1099G forms -- and to report fraudulent forms -- questions remained on what victims of identity theft could expect from the EDD.

7 On Your Side producer Renee Koury asked Saenz and Levy about the process victims would have to go through to prove that they didn't receive the funds on the 1099G forms they received, and how long it would take -- noting that tax return deadlines are rapidly approaching. Levy responded that those receiving incorrect forms are only "a small percentage," and that recipients should visit the EDD's website for more information on the tax forms.

7 On Your Side's Michael Finney further pressed on what was being done about fraudulent forms: "When an account is frozen because of suspected fraud, is the form 1099G also frozen, so a bad, mistaken form isn't sent out? And then the second part of this question is the EDD proactively going back to change form 1099G when mistakes or frauds are identified?"

RELATED: New EDD director vows changes after audits reveal disastrous mishaps

"We are suppressing form 1099 when we do have identity theft involved in a particular case, so we can avoid paying those out," Levy responded. "If indeed someone is receiving such a form and they have that kind of question, I would encourage them to try the online option so that we can get their information and move on, it's that much faster."

The EDD has one designated phone line you can use to request a corrected 1099: 1-866-401-2849. Or, you can fill out an online form here. Taxpayers will have to verify their identity with EDD, which will have to determine they were not the ones who received the benefits listed on the tax form.

Take a look at more stories and videos by Michael Finney and 7 On Your Side.

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