California rolls out AI-powered ID verification for benefits
mediaphotos via Getty Images
The state’s Employment Development Department now evaluates an applicant’s device and whether their IP address is domestic or foreign, all part of analyzing different signs of risk.
With about $110 billion in taxes coming in and $20 billion being paid out each year in unemployment, disability and Paid Family Leave benefits, California’s Employment Development Department prioritizes identity verification to prevent fraud. So, when applicants pushed back on identity verification requirements, EDD took action.
The department is rolling out a modernized approach that uses AI-powered digital identity verification from Socure to eliminate what was a need for new applicants to submit a selfie and upload documents. Now, identity verification happens in the background, said Ajit Girn, EDD’s chief information officer.
For instance, the new approach evaluates the type of device an applicant is using and whether their IP address is domestic or foreign.
“What Socure is able to do, in partnership with them, is evaluate the different signals of risk, or variations of risk, associated with how that person is presenting themselves online,” said Jordan Burris, head of public sector at identity company Socure. “They can do this evaluation in seconds” using the applicant’s address, phone number, email and other data points, he added.
Once the applicant is approved, they can move forward and file their claim. If they cannot be verified online, EDD routes them to ID.me for additional verification steps, including uploading documents and a selfie. If that still doesn’t work, the customer can file a claim by phone or submit a paper application in person at a field office.
“Our goal here was to make it more frictionless, seamless,” Girn said.
EDD is no stranger to putting customer experience first. In 2023, it launched myEDD, a portal that lets people apply for and access benefits in one place. But considering how much money the department handles, it can’t afford to jeopardize security. “There are people who are always trying to get in, and either they’re using fictitious identities or they’re using stolen identities,” Girn said.
So far, the defense-in-depth approach EDD takes is keeping fraud at bay, Girn said, but he wanted to be sure people felt comfortable applying for the help they need. “It was more of a customer service improvement and maintaining the fraud posture,” he said of the upgrade.
The shift to the new verification process started in August with about 10% of EDD’s unemployment insurance claimants. Now, about 25% use it, with the number rising each month. The change is only for new, first-time customers who don’t have a myEDD account yet.
“We may ramp up even further…. We may just start doing it every other week,” Girn said. “Right now, the solution is used for unemployment insurance customers, but we are working on another phase, which is — let’s call it Phase 3 — to offer the same solution for our disability and paid family leave customers as well.”
EDD workers are seeing benefits from the new system, too, he added. They now have access to claimants’ data, whereas before ID.me held the data and shared it with EDD.
“That data is owned by EDD,” Girn said. “It comes in, they can see exactly what claimants entered, what they clicked on, so this gives more insight into our customer base, and we can design future solutions based on the data that we’re gathering.”
Burris said EDD’s challenge is common among public- and private-sector organizations, often stemming from antiquated fraud-prevention strategies. For any agencies considering making a change, he recommends starting with a single application or use case. “The idea here is to provide the right level of transparency for agencies, such that they can make informed decisions and bolster their existing processes,” he said.
Girn said agencies also need to understand this is not the end of the road for modernization. “You can’t buy the new system or a new technology and think you are done,” he said. “You still have to constantly evolve and look at your customer needs and deliver them based on their expectation – meet the customers where they are.”
That will likely require rethinking policies with the answers to two main questions in mind, he added: How do customers use this application and what are their pain points?
“Is it delivering value to the customers? That’s the end goal,” Girn said. “Keeping that in mind as the center of every single improvement will help you deliver what exactly the customers are looking for.”