California extends contract with Bank of America for unemployment program despite criticism that criminals can tap into cards

California’s unemployment company has prolonged its contract with Financial institution of America to situation debit playing cards containing advantages for jobless residents regardless of criticism from state lawmakers that criminals had been in a position to faucet into the playing cards to commit widespread fraud.

The Employment Growth Division exercised an possibility to increase the financial institution’s contract for 2 years, although officers with the monetary establishment indicated that they wish to finish their work for the state unemployment system. The financial institution has had the unique contract since 2010.

“Below the contract, the state had the only possibility to increase and selected to take action,” mentioned Invoice Halldin, a spokesperson for Financial institution of America. “We have now suggested the state that we wish to exit this enterprise as quickly as attainable. Within the meantime, we’ll proceed to manage unemployment funds and meet the necessities of the contract.”

Though the financial institution receives a payment when debit playing cards are used, financial institution officers have informed lawmakers that the corporate has misplaced “a whole lot of tens of millions of {dollars}” administering this system because the COVID-19 pandemic started and tens of millions of Californians had been pressured out of labor as companies shut down to scale back the unfold of the coronavirus.

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