Letters out to verify frozen EDD disability claims, delays persist

OAKLAND, Calif. - Legitimate disability claimants whose accounts were frozen by California’s Employment Development Department because of suspected fraud, are finally receiving letters to verify their identities and get the money flowing again.

The EDD said the notices are specific to each claim affected following a widespread identity theft scam that hit the state’s disability insurance program, but would not elaborate about the suspected activity for fear of tipping off fraudsters.

"The Department has numerous resources dedicated to this top priority effort," the EDD said. "We need [claimants] help in following up with us…as quickly as possible."

The EDD said that will be critical getting legitimate claims cleared.

It comes amid a change in leadership after EDD Director Rita Saenz abruptly resigned on Friday and Gov. Gavin Newsom announced a new appointee.

Nancy Farias, currently the chief deputy director of external affairs, legislation and policy will be sworn in on Tuesday, Newsom’s office said.

Farias will have to tackle this latest round of fraud and frozen claims, including those still waiting to get their benefits reinstated.

"I think if they had a better way of reaching out to people, it would be pretty easy to verify that we are who we say we are," a mother named Erica from Brentwood said. "I was just left in a lurch with no money coming in."

Her verification letter just arrived in the mail dated Jan. 14, but it is postmarked 11 days later on Jan. 25. It is not clear why there was a delay in the letter getting sent out.

The overwhelmed state department still oftentimes is not picking up the phone and now even lawmakers whom have had success in the past helping constituents with the EDD are running into trouble doing so.

"We have the tools and the ability to help. The EDD simply will not accept our help and will not assist us in finding a pathway," Republican Assemblymember Jim Patterson of Fresno said. "The EDD just says basically you’re going to have to wait until we can figure it out."

Patterson said his office has been in touch with more than 100 people whose claims were unexpectedly suspended. And he said cases are growing by 30 to 40 in recent days.

Early in the pandemic, when thousands of legitimate unemployment claims were frozen amid rampant fraud, lawmakers could upload documents and help constituents prove their identities. Now, they’re stuck.

"It’s a mess and it’s hurting people," Democatic Sen. Steve Glazer of Orinda said. "My office is pushing hard to help constituents get the disability payments for which they are eligible."

EDD suspended 345 thousand disability claims for investigation and now says 98% are indeed fraudulent.

While it has continued paying $150 million a week in benefits, some legitimate claims have fallen through the cracks.

"I had to find out through your article on KTVU news as to why my payments stopped," Erica said.

Her husband, Jeff, is a carpenter and is also on disability by his doctor for back-related issues. He, too, was cut off from benefits the couple paid into.

"Now that we’re in the system, the system is failing," he said.

Brooks Jarosz is an investigative reporter for KTVU. Email him at brooks.jarosz@fox.com and follow him on Facebook and Twitter: @BrooksKTVU