Senator Patricia Bates Co-Authors Bill to Protect EDD Applicants from Identity Theft

Thursday, December 10, 2020

Senator Patricia Bates (R-Laguna Niguel) announced that she has co-authored bipartisan legislation this week to protect Californians applying for unemployment benefits from identity theft.

Senate Bill 58 would require the Employment Development Department (EDD) to end immediately the practice of including full Social Security numbers on its most frequently mailed documents. Senators Scott Wilk (R-Santa Clarita) and Melissa Hurtado (D-Sanger) formally introduced SB 58 and is co-authored by Senators Bates, Anna Caballero (D-Salinas Valley), and Assemblymembers Suzette Valladares (R-Santa Clarita) and Tom Lackey (R-Palmdale).

“With unemployment-related scams proliferating throughout California, there is no excuse for the EDD to continue to include full Social Security numbers on unsecured mail,” said Senator Bates. “That is why I have co-authored legislation to immediately require EDD to protect the personal information of Californians applying for unemployment benefits. The last thing the unemployed need to worry about is having their identity stolen by criminals.”

Last month, a group of California district attorneys sounded the alarm on the extent of the fraud and unemployment scams at EDD, stating it could be “the most significant fraud on the taxpayers in California’s history.” The federal government warned Governor Newsom’s administration in the spring that the dysfunction at EDD put it at high risk for fraud, yet the department continued to include Social Security numbers on correspondence.

Governor Newsom signed AB 499 (Mayes) on September 25 that prohibits state agencies such as the EDD from sending any communication to any person that contains that person’s full Social Security number, unless required by federal law. However, the mandate does not take effect until January 1, 2023.

Background:

  • September 23, 2012: Governor Jerry Brown vetoes SB 447 (DeSaulnier), which would have prohibited a state agency, unless required by federal law, from sending any communication to any person that contains that person’s full Social Security number. Governor Brown wrote, “While I understand the author's intent to prevent identity theft, the additional prohibition in this bill would hinder the ability of state agencies to promptly and accurately provide information to run essential programs."

  • March 28, 2019: The State Auditor releases a report urging the EDD to discontinue its use of full Social Security numbers as unique identifiers on all documents that it mails to claimants.

  • April 30, 2020: Senator Bates and other legislators send a letter to Governor Newsom about the failures of the EDD after hundreds of thousands of jobless Californians reached out to legislative offices seeking help with their unemployment claims.

  • June 26: Senator Bates and other legislators request an independent audit of the EDD through the Joint Legislative Audit Committee (JLAC). Democratic members of JLAC canceled a hearing in August, which would have been an opportunity to review the EDD audit request sooner.

  • July 22: Senators Wilk and Hurtado send a letter to Governor Newsom asking that he staff EDD 24/7 to help clear the backlog of claims.

  • August 5: Senator Bates and other legislators deliver another letter to the Governor demanding that he take action to improve EDD’s operations.

  • August 15: San Mateo sheriff deputies identify 21 people for engaging in a massive unemployment fraud scheme using inmates.

  • September 3: JLAC finally approves an audit of the EDD.

  • September 25: Governor Newsom signs AB 499 (Mayes).

  • October 23: At least 350,000 California unemployment debit cards have been frozen due to suspicious activity.

  • November 19: The State Auditor reports EDD has not yet removed Social Security numbers from some of the most commonly mailed documents as it recommended.

  • November 24: District attorneys announce a major fraud scheme operating in and around California’s prisons, estimating at least $140 million being paid to inmates and their accomplices so far.

  • December 7: Bank of America announces that fraud in California’s unemployment benefits system could total $2 billion.