State Senator Scott Wilk, R-Santa Clarita, joined dozens of lawmakers in November to send a letter to the CEO of Bank of America demanding answers regarding the decision to freeze and drain bank accounts associated with Employment Development Department (EDD) debit cards.

Wilk joined a bipartisan group of over 50 state legislators, including State Senator Henry Stern, D-Canoga Park, and Assemblyman Tom Lackey, R-Palmdale, in sending a letter to Bank of America Chairman and CEO Brian Moynihan on Nov. 24 requesting answers to specific questions regarding the freezing and draining of EDD accounts.

“Most beneficiaries receive their weekly Unemployment Insurance (UI) or Pandemic Unemployment Assistance (PUA) funds on a debit card issued and managed by Bank of America under contract with CA EDD,” the letter reads. “Over the last six weeks, reportedly due to significant fraud, hundreds of thousands of UI, PUA and State Disability Insurance (SDI) recipients have had funds taken from their cards or their cards frozen, leaving them unable to access their benefits.”

Reports indicate that at least 350,000 California residents are currently unable to access the UI, PUA and SDI benefits owed to them. However, the EDD is unable to provide an exact number, as they “only receive data from Bank of America after cards are frozen.” Additionally, less than 8% of debit card cases have reportedly been resolved. 

“This is another kick in the face to people worried about where their next meal will come from,” Wilk said in a statement issued Wednesday. “My office has been working 24/7 to help people, but at some point, there is only so much you can do when it is so screwed up.”

In October, a group of California’s District Attorneys released the details of unemployment scams at the EDD, stating it could be “the most significant fraud on the taxpayers in California’s history.” 

In an effort to clamp down on this fraud, the EDD universally froze thousands of EDD debit cards, including those belonging to legitimate claims. Bank of America then drained their accounts, which Wilk says left “many Californians with nothing to sustain them while this is being sorted out.” 

The letter asks several specific questions, which are listed below:

• Why is Bank of America taking funds and freezing cards? What criteria is Bank of America using?
• When CA EDD clears fraud or verifies identity on their end, why is Bank of America not immediately unfreezing the cards that CA EDD asks Bank of America to unfreeze?
• Our offices have many cases in which Bank of America states that EDD froze the card. Our staff call EDD, who claims the problem is entirely on Bank of America’s end. What is the solution to this problem?
• What needs to happen for a constituent to have their card reactivated and funds restored?
• Will you significantly increase staff tasked with reactivating cards and restoring funds to resolve these issues by Dec. 1, 2020?
• Has Bank of America had to pay any penalties due to fraud or failure to respond to alleged fraud within a certain timeframe related to California UI or PUA claims? If so, to whom and for what?
• Can Bank of America proactively contact consumers when their card is deactivated, or funds will be taken so they are not forced to discover this when they use the card?
• What can Bank of America do to stop the automatic freezing of multiple cards at one address without first checking with EDD to see if they may be legitimate?
• Who pays for fraudulent charges when it is not the consumer’s fault? Bank of America or another entity?
• Are there time limits under federal law by when Bank of America must unfreeze a debit card in a suspected fraud case? If so, what are they? Are there exceptions?
• Will you please provide an explanation to Governor Gavin Newsom and the CA Legislature as to how to unfreeze valid cards in a timely manner and prevent this problem from happening again by Dec. 1, 2020?

See Related: Senator Scott Wilk Calls For Audit Of California EDD Unemployment Agency

Governor Gavin Newsom’s response to the reported fraud was to create a “task force to coordinate state efforts,” similar to his response this summer to the “escalating and embarrassing debacle” with the EDD.

“EDD’s mismanagement has made it incredibly hard for millions of Californians to access unemployment benefits this year,” Wilk said in Wednesday’s statement. “Everything the Governor has done is a day late and a dollar short. After he put millions of people out of work, he should have prioritized fixing the problems at EDD as soon as they were called to his attention but he didn’t.”

Wilk’s participation in the letter is the latest in a series of actions that the state senator has taken regarding the EDD in the past eight months. In April, Wilk joined other legislators to send a letter warning Newsom about the “failures of the EDD after hundreds of thousands of jobless Californians reached out to legislative offices seeking help with their unemployment claims.”

“We owe it to the millions of California families whose jobs have disappeared through no fault of their own to process their UI checks without delay and to respond to their inquiries in real-time,” April’s letter reads. “In a state that claims the world’s fifth-largest economy and is home to the some of the world’s tech giants, it is inexcusable, unacceptable, and an embarrassment to settle for anything less.”

Two months later, Wilk and his colleagues asked for an independent audit of the EDD in a letter to the Joint Legislative Audit Committee (JLAC). 

“This urgent matter warrants the immediate attention of this Committee and the State Auditor,” June’s letter reads. “Therefore, we are requesting an audit of the Employment Development Department’s response to the COVID-19 pandemic. We are also requesting priority status for this audit.”

Democratic members of the JLAC cancelled a “crucial hearing” in August where the audit request would have been reviewed, but the EDD audit was ultimately approved in September.

“The audit will look at EDD’s efforts to deliver unemployment insurance benefits to Californians, including a review of any backlogs and efforts to improve call center operations and efficiencies,” the approval letter reads.

Meanwhile, back in July, Wilk and State Senator Melissa Hurtado, D-Porterville, sent a letter to Newsom asking for 24/7 staffing for the EDD in an effort to clear their backlog.

“While Californians struggle to make ends meet, the very least government can do is put in the man-hours necessary to straighten this out,” the July letter reads. “This is frankly not the time to sit back and wait for EDD to catch up. This is the time for decisive action and leadership.”

To read the full letter to Bank of America, click here.

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