EDD puts wrong name on Bay Area man's unemployment claim

SAN FRANCISCO (KGO) -- California's unemployment rate has dropped nearly to pre-pandemic levels - down to 4.2% in June.

But has low unemployment given the state time to fix all the problems that plagued the Employment Development Department during the pandemic?

Back in 2020, the EDD was so swamped with claims it wound up denying legitimate workers while handing billions of dollars to fraudsters. One San Francisco man said he heard all the stories, then this summer, had to apply for benefits himself. He says it didn't go so well.

VIDEO: Bay Area couple warns EDD of identity theft. 2 years later, agency seizes their tax return

The couple filed a fraud report with the EDD in June 2020. In April 2022, the Franchise Tax Board told them the EDD was taking $1,800 of their refund.

"Yeah it's scary I'm like maybe I'm better off not applying..." said Danny Ma.

Danny Ma of San Francisco was working throughout the pandemic, and hearing all the horror stories: millions losing their jobs, the EDD botching their claims, fraudsters making off with the benefits.

Now it was Ma's turn to file. "It was a little bit scary but I'm still vigilant," he said.

Ma was laid off from his tech job in June. He filed an unemployment claim, went through the ID.Me verification, and proved he really is Ma.

Until he saw his account.

"It's a completely different person, uh, I don't know how they got it wrong," Ma said.

VIDEO: EDD seizes man's tax refund to repay benefits it sent to a scammer: 'Why is this happening to me?'

The EDD has not revealed how many tax refunds it has confiscated, but says many involve workers who were overpaid by mistake, or fraud or technicalities.

Ma got a notice from EDD saying it had just created his online account. All good - except the notice had somebody else's name on it.

"I was like, what the, 'Dear Ngoc? Who's that?' Yeah they totally got it wrong from the get-go," Ma said.

He checked his account. Sure enough, it had the other guy's name and birthdate, claiming his benefits.

"Honestly, I was scared because, you know, the first thing that came to my mind was, did I just get my identity stolen?" Ma said. "Did someone steal my Social Security number, went in, change the stuff, calling into a rep to try to get you know, unemployment benefits for themselves through me?"

Echoes of all the fraud during the pandemic filled his head.

VIDEO: EDD seizes Bay Area woman's tax refund, wages to pay back benefits it actually paid to scammer

The couple had no idea a scammer had used one's identity to get unemployment benefits -- until the EDD confiscated her tax refund... then her wages.

He called the EDD. Someone picked up after just 10 minutes, and the agent typed the correct information into Ma's account -- but couldn't say what went wrong.

"That night I changed my password, changed all my security questions," Ma said.

7 On Your Side reached out to the EDD and told them about the mistake. Was it a flaw? Or an identity thief?

The EDD investigated and said it was: "A one-off situation within the patchwork nature of our current system."

The EDD has been adding components to an outdated computer system for years to keep up with new demands.

A spokesperson did not say whether the "patchwork system" may lead to more mistakes.

VIDEO: Disabled Californians plead for EDD to unlock their benefits after 340,000 accounts frozen

With his account frozen and his calls unanswered, one disability recipient went to the EDD office -- and found a line wrapped around the block.

The EDD said there was no sign of fraud on Ma's account, but he must go through identity verification all over again. The EDD said, "Since scammers will try anything to portray themselves as a legitimate claimant, we do need to confirm we are indeed working with Danny Ma."

And is Ma gonna be the last one to catch a mistake like this? He says be vigilant. EDD is launching a $136 million modernization program beginning this year. But old systems are still in place. If you see signs that things are working -- or not -- let us know about it.

Take a look at more stories and videos by Michael Finney and 7 On Your Side.

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