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EDD: $560 million fraud attempt averted

After receiving more than six times the amount of unemployment insurance claims, the Employment Development Department didn't pay out the suspected fraudsters.

SACRAMENTO, Calif. — When about 47,000 unemployment insurance claims came through the EDD, department personnel said they were suspicious since they usually see 7,000 or so claims during the same timeframe.

The $560 million in claims were swiftly rejected by EDD, department officials said on Thursday.

Officials say the fraud scheme involved flooding the EDD with unemployment insurance claims through paper filings and fax applications.

EDD is now mailing notices to claimants to separate the fraud attempts from any legitimate claims. The fraud applications are also set to delay some paper filing applicants.

Mailed notices will explain that an issue must be resolved before any benefits are paid and include information about fraud reporting. Any legitimate claimant who receives an EDD notice should respond with the requested verification right away and EDD will review and process the legitimate claim.

“Criminals will probe for weakness every day of the year and EDD will keep blocking them,” said EDD Fraud Special Counsel McGregor Scott. “EDD will continue to strengthen its fraud fighting capability and remind Californians to guard against identity theft.”

WATCH MORE: EDD wants proof of eligibility from 1.4 million people receiving unemployment—or their money back

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