EDD mistakenly takes $10,000 from CA man's account in attempt to fight suspected fraud

SAN FRANCISCO -- The EDD has been battling a wave of unemployment fraud by cutting payments to suspected scammers. However, legitimate claims are getting swept into the crackdown.

Our sister station, KGO-TV, heard from many unemployed workers, who said it happens without warning - they go to use their EDD debit card and it's blocked. One man from San Francisco had an even bigger scare: His money vanished entirely.

Anthony Serafino lost his job at Lucky Strike bowling alley when the pandemic shut it down. He'd been collecting unemployment ever since.

Until the EDD took it back again.

"They froze my account and took my money... super weird," Serafino said. "The really weird thing is that I didn't get informed about any of this. If anything happens they should inform me."

Serafino discovered something was wrong when he tried to pull $20 off his EDD debit card. It was "blocked."

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"So I went in the bank and they said, 'Oh no we can't help you. That's an EDD card, you have to call EDD,'" said Serafino.

But no one at the EDD could explain why his account was frozen.

"They said only Bank of America can do that. I called Bank of America. They said only EDD can do that... it went back and forth," Serafino said.

Eventually the bank did unfreeze his account, but his money went back to the EDD one payment at a time -- until all his money was gone.

"It was exactly $10,000. It was in different increments, but it added up to $10,000," said Serafino.

Serafino contacted EDD and the bank.

"Both said there's no problem with my card. So since there's no problem, they couldn't help me. But I was like, clearly there's a problem if I'm missing $10,000," he laughed.

Serafino believes his account had been flagged by the EDD for fraud, because a scammer stole money off his card several months ago.

RELATED: CA EDD employee speaks out, says thousands losing unemployment benefits by mistake

The bank did replace the fraudulent withdrawals, and he thought the problem was fixed. Until now.

He wants his money back. "I pay taxes and work, and it's my turn now to get back on that, and like, I'm not getting back. It's not fair to me at all."

KGO-TV reached out to the EDD and State Senator Scott Wiener who represents his district.

Within days, all that missing money popped back into Serafino's account.

The EDD did not explain what happened, but in a statement it said:

"EDD currently knows of 350,000 debit cards that have been frozen due to various fraud indicators... the department's top priority is to quickly verify the identity of any claimants... that may have been impacted by scammer attacks, while we... shut down potentially fraudulent claims."

"If they told me why the money was gone, I'd be fine, but it makes me feel like if I didn't reach out to you or anybody else, I would never have seen that money again," Serafino said.

The EDD says it's doing everything it can to avoid shutting down legitimate claims while it cracks down on fraud.