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| EDD offices have been closed to the public since the Oxnard shootings in 1993. |
California EDD lets go of Bank of America for unemployment payments, will soon start direct deposits
I am a customer of Bank of America and have no love for it. In fact, I'm seriously considering moving three accounts because of the bank's high fee schedule and minimum-balance requirements.
In this case, however, Bank of America is getting the short end of the public-relations stick. It was caught between the rock of getting payments out quickly and the hard place of screening for fraud. [bold added]
California’s Employment Development Department has selected a new contractor to pay unemployment and other benefits starting Feb. 15. The new vendor, Money Network, replaces Bank of America, which drew criticism during the pandemic for sometimes blocking payments to legitimate recipients...The upshot is that B of A has been trying to get of this contract for years, not that EDD is "letting go" of the bank.
A class-action lawsuit says BofA left the door open for unemployment benefit accounts to be hijacked by criminals. Then, the lawsuit said, BofA would freeze accounts, leaving victims unable to access past or future benefits, even with a replacement card.
BoA had made it crystal clear that it no longer wished to administer California benefits, but under the terms of its contract with EDD, the state had the “sole option” to renew its contract with EDD for two-year periods, which it chose to do, both in June 2021 and June 2023. “We have advised the state that we would like to exit this business as soon as possible,” BoA said in summer 2021.The new service provider, Money Network, will, like B of A, put "recipients’ benefits on prepaid debit cards" and "offer direct deposits to laid-off workers’ bank accounts." There's no mention about improved audit controls.
$40 billion in cumulative fraud is within reach, if we haven't gotten there already.
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