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The Employment Development Department announced earlier this month that they had halted payments on 345,000 disability claims associated with 27,000 suspicious doctors.

According to it’s January 26 update press release, EDD continues to confirm that most of the suspect disability insurance medical provider accounts it flagged as suspicious were fraud attempts. The few providers that were not fraud – but instead victims of identity theft – are completing verification along with their patients to then resume certifying claims.

To date, EDD has confirmed that approximately 98 percent of the 27,000 medical provider accounts it initially flagged as suspicious were likely fraudulent. Specifically, 485 providers have verified their identity at this point and the rest did not.

As EDD separates out the suspected fraudulent accounts it is then verifying the claimants who were suspended when their medical provider’s information was compromised. These claimants received notices this week to verify their identity with as quickly as possible to help in resuming payments.

In addition, other claimants have received different notices with other verification requirements specific to their claim. To avoid tipping off fraudsters, further details about the various verification procedures will not be released.

But according to a story in the Sacramento Bee most of the 1.4 million people asked last year to prove they properly received federally-funded unemployment benefits have not responded to the state’s request and could eventually face penalties and repayments.

The state first sought the information in November.  In some cases, it said, it could seek a potential repayment of all benefits received. It talked about penalties. The EDD said it would add a 30% penalty “if we determine that you intentionally gave false information or withheld information to receive benefits.”

So far, about 280,000 people have responded. Of those, about 90% were found eligible for the benefits. The others will see further reminders about the importance of the federal requirement. They’re being given time to appeal and submit further documentation.

If they don’t respond to that notice, they could be deemed ineligible for the benefits they were paid. They would have the chance to appeal, but could have to pay back what they’ve received if they don’t qualify for a waiver.

Those who were not notified have already provided proof of employment or were not subject to the requirement.