Victims of EDD Debit Card Hacking Describe Experiences on Road to Recovery
SAN FRANCISCO (KPIX) -- The unemployment debit card accounts of tens of thousands of Californians have been hacked and frozen. KPIX has received e-mails from more than 300 victims since last October when we first exposed the massive hacks.
We are now learning that Bank of America, which has the exclusive contract to handle the funds for the state Employment Development Department, is facing yet another class-action lawsuit.
"I didn't think this was possible. Like my stomach, my heart just dropped into my stomach and I felt, like, so shocked," said Roland Oosthuizen. That was his reaction when he logged into his Bank of America EDD debit card account last September. "My account had been drained of $5,000 from the previous five days," Oosthuizen said.
His debit card had been hacked at various ATMs around town. He and his mother Rosemary Mathews spent hours on the phone to file a claim.
"That very first day I was on the phone seven hours and I am not kidding," Mathews said.
Imagine her surprise two weeks later when she discovered her card had been hacked as well, for a thousand dollars. "It was really scary. I don't want to cry about this but it was my rent money and I didn't have it," Mathews said.
Mother and son say the worst of it was the identical letters they received from the bank saying their claims were closed with no money back. It's the same thing KPIX heard from more than 300 people who reached out with similar stories.
Most had their EDD Bank of America debit cards hacked at ATMs far from where they live. Others' accounts were hijacked, taken over by fraudsters who routed the money to their own accounts.
"Someone had come into our account, stole our identity, changed our bank routing information, put in their own bank and routing information, wiped me of $7,500," said Michelle Barrionuevo Mazzini.
Many ended up having their accounts frozen.
"I had to verify my identity with EDD and I did so and it's been over a month and Bank of America still won't unfreeze my account at this time," said Andreea Puzderri.
Many say they submitted all the evidence needed to prove their identity.
"I've sent them my lease agreement with my identity, my W-2s, my pay stubs, everything that supports my claim and they still choose to arbitrarily hold on to nearly $5,000," said Julian Cardenas.
"They tell me you have to verify your identification again ... I'm not doing that, I did that, that's done!" exclaimed Brandy Allen.
One common experience everyone mentioned: getting the runaround.
"I have called them back and forth and, like everybody else does, they direct me to EDD, EDD directs me to them and I'm told something different every time," said Erin Haben.
"Same thing as everybody else. Phone calls back and forth. EDD, Bank of America, identification verification, dah, dah, dah," Brandy Allen said.
"One department tells you one thing, the other department tells you the exact contradicting answer and they treat you like you are the one that stole the money!" said Terri Schaffer.
We wanted to get their reaction to some statements from a Bank of America executive, Faiz Ahmad, who was called on the carpet for the first time by lawmakers in Sacramento and who said: "We've added thousands of agents to our various call centers to ensure that claimants received the same treatment as any other Bank of America customer."
All 56 people on our group zoom interview told us that's not true.
Then we showed them another clip from Ahmad in which he claimed "The wait times at our call centers are one minute with the tail being between one and five minutes."
Again, our interviewees told us in unison that is absolutely not true.
"It's ridiculous. The minute that they hear you're (calling about) EDD, you're a second-class citizen," said Terri Schaffer.
"It's very sad that an officer of such a great institution has such little knowledge of what is going on in his own company," said Luis Harbottle.
Several told us they did get their money back but only after interviews with KPIX and CBS This Morning were broadcast.
"I'm really grateful. It does feel hopeless at times but, you know, we just have to keep pushing forward," said Sandra Sanchez.
Others got empty promises: "I received a letter saying that 'we issued a temporary credit for the amount that's been lost' but my account is still frozen so I don't have access to this account," said Miki Williams.
Most in the group we interviewed have been waiting three to four months, some even longer.
"It's been a year. It's still under investigation so I kind of lost hope, you know," said David Garcia.
Lost hope and lost trust. "These cards are unsecured. No I don't want this card, get rid of the cards," said Greg Dodd.
FAQs on Bank of America's website clearly say: "The Bank of America 'zero liability' policy protects you against fraudulent transactions."
"Zero liability to me means zero liability," said Adam McNeile, an attorney with the law firm Kemnitzer, Barron and Krieg who represents Margaret and Roland in a class-action complaint against Bank of America that alleges, among other things, breach of contract or closing claims without investigating and failing to provide provisional credit.
"With Rosemary and Roland, the letters were dated ... two days after they opened the fraud claims and there's simply no way that Bank of America could have adequately investigated these fraud claims before closing them," McNeile said.
The lawsuit also alleges negligence for issuing debit cards without security chip technology.
"If Bank of america had put chips onto its cards then it would have been impossible for fraudsters to duplicate the cards and then withdraw money from ATMs, including Bank of America ATMs," McNeile said.
As for Roland Oosthuizen, he ended up getting his $5,000 back, the day after filing the lawsuit.
"I don't think it was a coincidence," Oosthuizen said.
Rosemary Mathews is still waiting to get her $1,000 back.
"This is our income. I mean, there are people worse than me. I'm sure people have gone bankrupt, have lost their houses, been evicted. It's just not right and I didn't even care if I didn't get all my money back or whatever. I just felt that Bank of America needed to be held accountable," Mathews said.
Speaking with our group, we noticed that some people are beginning to get provisional credit. We don't know if it's a trend but, if it is, that's a good sign that Bank of America is feeling the pressure.
Bank of America statement (Bill Halldin, Spokesperson)
As California's unemployment program faces billions of dollars in fraud, Bank of America is working every day with the state to prevent criminals from getting money and ensuring legitimate recipients receive their benefits.
We have added thousands of agents to answer phone calls and investigate claims for the areas of the program we are responsible for and, as a result, our average wait time for callers has dropped dramatically. While 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.