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Yet another Californian is on track to join President Joe Biden’s administration: Labor Secretary Julie Su has accepted Biden’s offer of the No. 2 position at the U.S. Labor Department, Bloomberg reports. If she’s confirmed by the Senate, Newsom will get to make yet another highprofile appointment. But Su will likely face scrutiny for her oversight of the beleaguered Employment Development Department, which on Monday confirmed that nearly 10% of all unemployment claims it’s paid so far have been fraudulent. That amounts to nearly $11.4 billion. EDD also said that another 17% of payments, or $19.4 billion, may have gone to fraudulent claimants.
On Tuesday, the non-partisan State Auditor released the results of an audit about the Employment Development Department (EDD) originally called for by members of the Senate Republican Caucus last summer. The audit results come after news reports show an increase in the number of backlogged claims and that rampant fraudulent unemployment claims are now at a staggering $11 billion and could rise as high as $30 billion.
The audit found that “the economic downturn worsened EDD’s already poor performance” and that, even after adding numerous staff, EDD “only marginally improved the percentage of answered calls.” Last year, Senate Republicans asked for call center metrics to be included in the budget as a way to improve accountability, but the budget approved by the Governor and Democratic leadership did not include that proposal. The audit also found that, due to the inefficiencies and poor management at the EDD, some Californians will have to pay back benefits.
In response to the audit, Senate Republican Leader Shannon Grove (R-Bakersfield) and a bipartisan group of senators delivered a letter to the Chair of the Joint Legislative Audit Committee (JLAC) and the Chair of Senate Budget Subcommittee No. 5 requesting an immediate oversight hearing. The oversight hearing should focus on EDD implementing the Auditor’s recommendations to address the backlog of claims and prevent future fraud.