California unemployment system blamed for $10 billion in fraudulent payments

Another $20 billion in payments suspected

SACRAMENTO, Calif. (KYMA, KECY) - A new audit blames California's unemployment agency for "significant missteps and inaction" that led to at least $10.4 billion in fraudulent job claim payments during the pandemic.

California State Auditor Elaine Howle said she believes the actually number of fraudulent claims is likely far higher when she released her report Thursday. The California Employment Development Department (EDD) did admit this week it's investigating another $20 billion in payments for possible fraud.

Howle said last spring the federal government warned EDD it was a high risk for increased fraud, but the agency waited four months to make any changes.

It claims it didn't get enough support from the Trump administration, but Howle says the agency's lax approach allowed officials to miss the fraudulent cases.