What's Happening?
The California Employment Development Department (EDD) has been found to have wasted over $4.6 million on mobile devices that were left unused, according to a recent audit by the California State Auditor.
During the COVID-19 pandemic, the EDD acquired more than 7,200 mobile devices, including cell phones and wireless hotspots, to facilitate remote work for staff handling a surge in unemployment claims. However, the audit revealed that as of April 2025, the agency continued to pay monthly service fees for these devices, many of which had not been used for extended periods. Investigators discovered that over 6,200 devices had not been used for at least four months, with some remaining unused for over four years. This issue is part of a broader pattern of mismanagement within the EDD, which previously acknowledged paying out up to $31 billion in fraudulent unemployment claims during the pandemic.
Why It's Important?
The findings highlight significant mismanagement within the EDD, raising concerns about the agency's oversight and accountability. The wasteful expenditure on unused mobile devices represents a misuse of taxpayer funds, which could have been allocated to more pressing needs. This incident adds to the EDD's troubled history, including a massive fraud scandal involving billions in fraudulent unemployment claims. The agency's inefficiencies and lack of proper controls could undermine public trust and confidence in its ability to manage unemployment benefits effectively. Furthermore, the financial implications of such wasteful spending could impact the state's budget and its ability to fund other critical services.
What's Next?
In response to the audit, the EDD has taken steps to address the issue by adopting all auditor recommendations and implementing policies for automatic phone disconnection controls. The agency has also initiated efforts to shut down unused devices to prevent further waste. Moving forward, the EDD will need to enhance its oversight and management practices to prevent similar issues from occurring. This may involve stricter monitoring of resource allocation and improved accountability measures. Additionally, the agency may face increased scrutiny from state officials and the public, prompting further investigations into its operations and financial management.
