SACRAMENTO, Calif. (KNX) — California officials revealed Tuesday they were working to combat “a recent move by organized criminal elements to file false disability insurance claims.”
The scheme reportedly involved suspected organized crime outfits “filing sale disability insurance claims by attempting to use stolen credentials of individuals and medical or health providers,” according to a statement by the state Employment Development Department (EDD), which issues unemployment wages.
At this time, the EDD has not released any information as to estimated funds lost to suspected fraudsters.
“Our investigators are actively evaluating suspected scam-related claims and activities. No losses have been confirmed at this time,” the EDD’s website stated.
The agency has added new safeguards to tackle the problem, including suspending payment on some claims until their legitimacy can be verified.
The EDD has been beset with significant fraud issues in recent months, particularly at the onset of increased COVID-related unemployment benefits. The state has lost an estimated $20 billion to fraudulent claims. Organized criminal networks are suspected to be behind most of the scams.
The EDD has advised anyone who suspects their identifying information may be used for EDD fraud purposes to file a report with the agency. Filing a fraud report may be completed online by visiting askedd.edd.ca.gov and selecting “Report Fraud.”
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