Fraud and Penalties: What You Need to Know

En español

Collecting Unemployment Insurance (UI) benefits based on false, misreported, or unreported information to the EDD is considered fraud. UI claimants are legally responsible to follow the requirements set by state law. If you commit UI fraud, you could face serious penalties and consequences. The EDD also greatly appreciates your partnership in combatting fraudulent activity and protecting UI benefits for legitimate California workers in need.

COVID-19-Related Fraud Investigations Update

The EDD is aggressively fighting fraud in the wake of unscrupulous attacks on the unemployment program here in California and across the country. These perpetrators are often using stolen identity information from national and global data breaches, as well as exploiting expedited payment efforts in the federal Pandemic Unemployment Assistance (PUA) program. Claims identified with suspicious account information have been closed and EDD investigators are partnering with local, state, and federal law enforcement to expose and prosecute offenders to the fullest extent of the law.

Customers should be aware of a few other actions taken that could impact some legitimate claimants:

  • No automatic backdating of PUA claims The EDD is no longer automatically backdating new PUA claims in order to stop perpetrators from targeting earlier months when federal stimulus payments were available. Legitimate PUA claimants, including small business owners and independent contractors, who believe their claim should be backdated from when they initiated their claim are encouraged to contact the Department in one of two ways:
    • Submit an online inquiry through AskEDD. Select Unemployment Insurance, then Claims Questions sub-category, and then Backdate the Effective Date of my Claim Due to COVID-19.
    • Speak to a representative by calling one of the two EDD UI Call Centers at 1-833-978-2511 or other numbers listed on our Contact EDD page.
  • Limiting multiple claims at same addresses While there are legitimate reasons different workers would be living or collecting mail through the same address, the EDD has shut down multiple claim situations following key identified patterns. These situations are believed to be fraud and scammers will often try to intercept, redirect, or gather mail associated with these claims. The EDD warns Californians that the Department will not send representatives to your home and encourages you to help the Department combat fraud by reporting it and using one of the following steps with any mail you may receive that does not pertain to you:
    • Send any fraudulent documents or mail directly to EDD investigators through EDD PO Box 826880, MIC 43, Sacramento, CA 94280-0225.
    • Write “Return to Sender” on the envelope and provide it to your mail carrier. Envelopes that may contain debit cards that have yet to be activated can also be returned to sender. The cards are sent on behalf of the Bank of America from an address in Tennessee.

Report Fraud

The best way to report fraud is to submit a Fraud Reporting Form online. You can also fax 1-866-340-5484 or call the EDD Fraud Hotline at 1-800-229-6297 (for reporting fraud only).

When reporting fraud:

  • Provide all relevant information about the issue. Include your name and phone number if you don’t want to remain anonymous. You will not receive a call from the EDD unless more information is needed.
  • Send any fraudulent documents or mail to EDD PO Box 826880, MIC 43, Sacramento, CA 94280-0225. You can also write “Return to Sender” on the envelope and provide it to your mail carrier.
  • If you need to provide more information after reporting fraud, contact the EDD again online, by phone, or by fax. Include the reference number provided when you first reported the issue.

Note: The EDD greatly appreciates your partnership in combatting fraud. But to ensure the confidentiality and integrity of any investigation, the EDD does not provide status updates to fraud reports unless court-ordered or required by law.

For more information, review How to Report Unemployment Insurance Fraud (DE 2370) (PDF).

Penalties

UI fraud penalties can include:

  • Prosecution by government authorities.
  • Possible jail or prison sentences.
  • Repaying the UI benefits collected, plus penalties and fines.
  • Loss of future income tax refunds.
  • Losing eligibility to collect UI benefits in the future.

Information for Claimants

  • Returning to work but continuing to collect UI benefits without reporting your work and wages.
  • Not reporting wages during the week that the work was performed.
  • Working a temporary or part-time job but not reporting your work and wages.
  • Withholding information or providing false information to the EDD.

Information for Employers

Help minimize your UI costs, avoid higher UI taxes, and prevent overpayment of UI benefits by providing us with accurate information.

Identity Theft and Imposter Claims

Identity theft is a growing problem affecting millions of people and their livelihoods. UI identity theft occurs when you use someone else’s personal identifying information to file a UI imposter claim and illegally obtain UI benefits.

If you think someone has filed a UI claim in your name, submit a Fraud Reporting Form online. You can also fax 1-866-340-5484 or call the EDD Fraud Hotline at 1-800-229-6297 (for reporting fraud only).

When reporting fraud:

  • Provide all relevant information about the issue. Include your name and phone number if you don’t want to remain anonymous. You will not receive a call from the EDD unless more information is needed.
  • Send any fraudulent documents or mail to EDD PO Box 826880, MIC 43, Sacramento, CA 94280-0225. You can also write “Return to Sender” on the envelope and provide it to your mail carrier.
  • If you need to provide more information after reporting fraud, contact the EDD again online, by phone, or by fax. Include the reference number provided when you first reported the issue.

Note: To ensure the confidentiality and integrity of any investigation, the EDD does not provide status updates unless court-ordered or required by law.

For more information about protecting yourself from identity theft, visit Identity Theft Prevention and review the California Attorney General’s Identity Theft Information Sheets.

When an identity thief files an imposter claim for one of your employees, it can increase your UI tax rates. It is important for us to partner to protect your employees and the integrity of the UI program.

For more information on preventing, identifying, and reporting identity theft, visit Identity Theft Prevention.