{"id":5072,"date":"2021-01-18T12:00:52","date_gmt":"2021-01-18T19:00:52","guid":{"rendered":"https:\/\/sandiegonewsdesk.com\/?p=5072"},"modified":"2021-01-18T22:46:57","modified_gmt":"2021-01-19T05:46:57","slug":"bank-of-america-sued-for-failure-to-protect-edd-unemployment-debit-card","status":"publish","type":"post","link":"https:\/\/sandiegonewsdesk.com\/?p=5072","title":{"rendered":"Bank of America sued for failure to protect unemployment recipients from fraud"},"content":{"rendered":"

Written by Justin Culetu\u00a0<\/span><\/em><\/p>\n

Bank of America is facing a federal lawsuit for its failure to protect thousands of Californian\u2019s unemployment debit cards from fraudulent activity.<\/span><\/p>\n

Last Thursday, the U.S District Court in San Francisco filed a complaint that Bank of America inadvertently provided proper security to stop criminals from obtaining access to unemployment debit card accounts. For a bank that has $2.16 trillion in <\/span>total assets<\/span><\/a>, supplying its customers with basic security should not be much of an issue. A spokesman for Bank of America stated that the fraud in California is connected to state application vetting.\u00a0\u00a0<\/span><\/p>\n

\u201cWe have added thousands of agents to answer phone calls and investigate claims\u2026 the vast majority of unemployment fraud is committed by those filing false applications, when fraudulent transactions occur on benefit cards we review those claims and restore money to legitimate recipients,” read a statement from the company.<\/p>\n

Attorney Brian Danitz, who filed the suit, feels differently, “Bank of America should have known this was coming, they did not provide basic security measures. Instead they gave cards without a chip, just with a magnetic stripe, which is easily subject to fraud,”<\/p>\n

Since 2010, Bank of America and the state have contracted to pay out unemployment benefits electronically. Also included in the bank\u2019s state contract is a promise to deliver the \u201cbest in class\u201d fraud monitoring. During the pandemic, confusion over unemployment fraud has led to a back and forth blame game between the state and Bank of America and now the class action lawsuit is awaiting court review.\u00a0<\/span><\/p>\n

Some issues in the complaint include a deficiency of secure microchips in the unemployment cards, a shortcoming in securing private account information, as well as a slow response to fraud claims by the consumers. According to the complaint, Bank of America also violated a \u201czero liability\u201d clause in its state contract, which makes them responsible to pay for any fraud instead of the unemployment cardholders. This means that the EDD may not face litigation for freezing unemployment payments.\u00a0\u00a0<\/span><\/p>\n

Since March of 2020, the EDD has paid <\/span>$113 billion<\/span><\/a> in unemployment benefits. The thousands of fraud claims due to poor management are only one example of the state\u2019s failed COVID-19 response. With lockdowns continuing to ravage the state\u2019s economy and stunting the possibility of growth, the department needs to address these issues quickly.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Written by Justin Culetu\u00a0 Bank of America is facing a federal lawsuit for its failure to protect thousands of Californian\u2019s unemployment debit cards from fraudulent activity. Last Thursday, the U.S District Court in San Francisco filed a complaint that Bank of America inadvertently provided proper security to stop criminals from obtaining access to unemployment debit…<\/p>\n","protected":false},"author":3,"featured_media":5073,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-5072","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy"],"yoast_head":"\nBank of America sued for failure to protect unemployment recipients from fraud - San Diego News Desk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/sandiegonewsdesk.com\/?p=5072\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bank of America sued for failure to protect unemployment recipients from fraud - San Diego News Desk\" \/>\n<meta property=\"og:description\" content=\"Written by Justin Culetu\u00a0 Bank of America is facing a federal lawsuit for its failure to protect thousands of Californian\u2019s unemployment debit cards from fraudulent activity. 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