New: California’s State Auditor says the Employment Development Department wasted $4.6 million in taxpayer dollars on monthly service fees for 6,200 unused cell phones.
— Ashley Zavala (@ZavalaA) December 12, 2025
They sat in a storage room, some for years. https://t.co/tQ0bjx9Q7d pic.twitter.com/oTNrHJGjCj
December 12, 2025
Investigative Report I2025-1The Governor of California
President pro Tempore of the Senate
Speaker of the Assembly
State Capitol
Sacramento, California 95814Dear Governor and Legislative Leaders:
The California State Auditor, as authorized by the California Whistleblower Protection Act, presents this report summarizing some of the investigations of alleged improper governmental activities that my office has recently completed. This report details five substantiated allegations involving several state agencies. Our investigations found waste, improper payments, misuse of state resources, and other improper governmental activities. Our findings include more than $5 million that state agencies have either wasted, misused, or failed to report.
For instance, an agency wasted more than $4.6 million on monthly service fees for thousands of mobile devices that went unused month after month and, in many cases, for more than two years. Agency management stated that it was unaware that the agency was paying for so many unused devices, but it had access to nonusage reports and invoices that should have identified the problem much sooner. Another case involves an agency that continued to pay an employee who was on extended leave and preparing for retirement for an additional 15 months beyond when his leave hours were fully depleted. The agency did not accurately track the leave hours the employee used and overpaid him more than $170,000. In another example, an agency did not report approximately $400,000 in taxable fringe housing benefits received by employees who rented state-owned housing at below market value. As a result, the affected employees may have significant unpaid tax liabilities.
State agencies must report to my office any corrective or disciplinary action taken in response to recommendations we have made. Their first reports are due within 60 days after we notify the agency or authority of the improper activity, and they continue to report monthly thereafter until they have completed corrective action.
Respectfully submitted,
GRANT PARKS
California State Auditor
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