California’s unemployment agency was warned about identity theft risks in 2019
California’s auditor warned the state’s unemployment agency 18 months ago that its use of Social Security numbers on some mailed documents “continues to put some Californians at risk of identity theft.”
The March, 2019 audit noted that the Employment Development Department was trying to adjust as part of its effort to modernize its antiquated benefit technology, but probably would not finish resolving the identity issues until sometime next year.
The audit instead urged an interim solution to the key problem of including Social Security numbers on documents sent to residents. EDD says today it is aggressively taking steps to conceal that number.
But the number is still appearing on some documents, and the audit last year warned, “The inappropriate disclosure of claimant information (discussed in the audit) demonstrates the tangible risk to claimants’ privacy if it does not act sooner.”
In recent weeks, EDD has been investigating reports that people have received multiple mailings purportedly from the agency. A Clovis man reported that someone gained access to his son’s EDD-issued debit card and withdrew thousands of dollars.
The department sees no connection between last year’s warnings about identity theft and the recent surge in suspicious activity.
“There is no evidence that the spike in suspected fraud we are investigating stems from EDD mailings,” said agency spokeswoman Loree Levy.
She said the schemes EDD and other investigators are probing “involve a much more complex profile of personal identifying information these scammers possess than what you can find on any potential EDD mailing about unemployment benefits,” suggesting the information was obtained through data breaches at private companies.
EDD has urged people to report identity theft, saying in a tweet that it “is a growing problem affecting millions of people and their livelihoods. If you think someone has filed an Unemployment Insurance (UI) claim in your name, report it. Visit http://Bit.ly/UIFraudPenalties … to find out how you can report UI fraud to the EDD.”
The 2019 audit was conducted long before this year’s unprecedented surge in jobless claims, a deluge that has overwhelmed the agency.
The key problem it highlighted involved EDD’s use of Social Security numbers on certain documents. The auditor cited claimant complaints and concerns drawn from EDD’s website from 2015 to 2018 to show that constituents were concerned about identity theft.
“Until EDD discontinues its use of full SSNs as unique identifiers on documents that it mails to claimants,” the audit said, “it will not have fully responded to legislative concerns and its claimants concerns.”
And, the audit said, it will not have addressed “the risk that it may inappropriately disclose claimants information.”
Federal law requires states to use Social Security Numbers when verifying eligibility for jobless benefits, the auditor said. State law generally bars mailing such numbers to people, but does allow EDD to do so if federal law says it can or in certain other instances.
The audit said EDD should adjust and modernize its most used forms by March 2020 — which, it turned out, was the month the coronavirus pandemic began to send unemployment claims soaring.
The agency told the auditor that month that it was making progress in changing its forms to conceal Social Security numbers, and Levy told The Bee EDD “has been developing and implementing several interim solutions as we simultaneously work to modernize our entire benefits processing system for a more permanent solution.”
The department completed the first phase of a Claimant’s Privacy Measures Project to cover up the Social Security number on some of its our highest volume forms earlier this summer.
The agency also noted that a special department committee has been reviewing different forms. In March, it said that several had had the Social Security number removed or replaced with the last four digits only.
But the entire review of how to deal with any personal identification information, it told the auditor, won’t be complete until December 2021.
The department remains the focus of intense scrutiny by lawmakers and the auditor. The auditor said last month it was putting EDD and other state agencies receiving federal money on a “high risk” list it would watch closely.
Lawmakers also are pressing for a more aggressive audit of all of its operations.
“They were warned a year ago and apparently didn’t do anything,” said Assemblyman Jim Patterson, R-Fresno., who has assumed a role as a vocal EDD watchdog.
This story was originally published September 17, 2020 at 1:14 PM with the headline "California’s unemployment agency was warned about identity theft risks in 2019."
.jpg)