California officials who turned a blind eye to unemployment scams — potentially worth tens of billions of dollars during the pandemic — will now be put directly under the microscope of the federal government.
The US Department of Labor is set to send a letter to the state’s Employment Development Department announcing a “strike team” will soon be touching down in the Golden State to root out theft and abuse, The California Post has learned. The investigation will be similar to efforts currently underway in Minnesota.
Click Here to Subscribe to the California Political Review
“Financial issues and potential fraud in California’s unemployment insurance program will be fully examined,” Labor Secretary Lori Chavez-DeRemer told The Post in a statement, while also taking a shot at former President Joe Biden.
“The previous administration turned a blind eye toward failing Labor programs: This ends now.”
Federal investigators have been combing through financial records tied to Minnesota fraud schemes after prosecutors uncovered what they describe as a sprawling web of pandemic-era theft, including the massive “Feeding Our Future” case that allegedly siphoned roughly $250 million in federal child-nutrition funds through fake claims and shell companies.
In total, a staggering $9 billion may have been stolen in Minnesota, according to federal prosecutors. Nearly 100 people had been charged with crimes as of last month.
The breadth of fraud in California, however, could leave Minnesota’s thievery looking like chump change.
The feds provided California nearly $290 billion in relief funds during the pandemic, and EDD was among the largest recipients as it was tasked with rapidly implementing expanded unemployment benefits.
