SACRAMENTO, Calif. (AP) — A new audit says California’s unemployment agency might have overpaid millions of people since March.
The report from California State Auditor Elaine Howle says the state stopped enforcing some eligibility rules so they could process claims faster. The result is up to 4.1 million claimants could have to repay some or all of the unemployment benefits they got during the pandemic.
The audit says the agency has “no clear plan” to address that backlog. It says the backlog represents a workload never before seen by the department. The agency has the power to waive repayment for some people in cases that don’t involve fraud.
The audit follows a roadblock in early January that left many unemployed Californians unable to reap much-needed benefits. Payment was suspended for about 1.4 million people pending verification as 3.5 million unemployment claims were deemed “potentially fraudulent”, according to the California Employment Development Department.
The state has also acknowledged that the department was bilked out of hundreds of millions of dollars in COVID-19 unemployment funds that went to fraudsters, including 35,000 claims filed by inmates.