UPDATE: An urgent fraud investigation is underway as officials reveal that an estimated $150 billion in COVID-19 relief funds has been lost to fraud in California alone. This shocking revelation follows years of unchecked spending, prompting calls for accountability from government leaders.
Authorities confirm that the California Employment Development Department (EDD) distributed billions without proper verification, leading to rampant fraud amidst the COVID-19 pandemic. Critics, including columnist Susan Shelley, argue that the state’s response to the pandemic has been marred by mismanagement and exploitation of emergency funds meant to support the sick and impoverished.
New reports show that the U.S. Department of Labor issued guidance as early as April 2020 to prevent fraud in unemployment benefits. However, California officials continued to disperse funds without adequate checks, resulting in massive losses. Governor Gavin Newsom and the California legislature have pushed the burden of repaying federal loans onto local employers, which will lead to higher payroll taxes for countless businesses.
As of this week, the Trump administration’s Department of Health and Human Services announced a significant policy shift, reversing a Biden-era rule that allowed child care providers to receive payments without verification of attendance. “Paying providers upfront based on paper enrollment instead of actual attendance invites abuse,” stated Deputy HHS Secretary Jim O’Neill.
The scandal extends to numerous other programs, with reports indicating that tens of billions in homelessness spending has vanished without a trace. Federal investigations are now poised to delve deeper into these allegations, with President Trump asserting that “we are not going to pay California” for its mismanagement.
In Minnesota, federal prosecutors have already secured numerous convictions related to fraudulent meal voucher programs. Similarly, the scandal surrounding fraudulent child care facilities has only just begun to unfold. Minnesota Governor Tim Walz recently announced he is dropping his re-election campaign amid growing scrutiny.
As investigations ramp up, the public is left to ponder the ramifications of this widespread fraud. “People have to go to prison for these abuses,” Shelley emphasizes, warning that without accountability, politicians and interest groups will continue to exploit taxpayer dollars.
The urgency of these developments cannot be overstated. The fallout from this fraud could lead to significant changes in how government assistance programs are managed in the future. As federal and state investigators work to uncover the extent of the wrongdoing, the public is urged to stay informed and engaged.
Next steps: Watch for updates as federal investigators head to California to examine the missing funds. The impact of these investigations will be felt across the state and potentially nationwide, raising critical questions about accountability in government spending.
For ongoing updates, follow @Susan_Shelley on X and stay tuned for more breaking news on this developing story.
