Top Four Times California Burned Taxpayer Dollars

With fraud and wasteful spending spiking online, calls have surged from some users to examine California’s decades of waste. Though Democratic California Gov. Gavin Newsom’s online team has actively attempted to brush aside concerns, billions have been burned by the Democrat-led state.

Independent journalist Nick Shirley’s viral post over the weekend sparked a massive online push to track down fraud and mismanagement of federal dollars after he exposed Somali-run daycare centers in Minnesota. However, while attention has focused on the Midwest, many online have pointed out how California, under majority Democratic leadership for more than a decade, played its own part in wasting taxpayer dollars.

1. COVID-19 Unemployment Insurance Fraud

In March 2020, President Donald Trump signed the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act during the final year of his first term as the United States grappled with the COVID-19 pandemic.

The bill created three temporary federal programs administered by states like California through the Employment Development Department (EDD), including the Pandemic Unemployment Assistance (PUA).

By fall 2021, under President Joe Biden, California’s EDD faced questions about its estimate of fraudulent payouts through the PUA. During an oversight hearing, then-EDD Director Rita Saenz claimed $20 billion of the $170 billion paid out was estimated to be fraudulent.

But in October 2022, LexisNexis Risk Solutions Government Division CEO Haywood Talcove told KCRA3 that the fraud estimate was severely undercounted. His data showed the EDD paid out $177 billion through pandemic programs, with fraud closer to $32.6 billion. Talcove warned that the state would never recover most of it and said he believed the money went to transnational criminal groups, sex trafficking and child extortion.