California under Governor White Teeth has become...

Editor's note: ...a "fraud factory" where billions (even claims of $180 billion) vanish through unemployment scams, healthcare schemes, and pandemic programs while the state either looks the other way or reacts long after the money's gone. The tone here is blunt: this isn't bad luck, it's a system so bloated and poorly policed that it practically invites criminals to loot it, while leadership denies, deflects, and keeps spending like nothing's wrong. California's problems aren't about one policy. They're about a system that's broken, bloated, is being pillaged and no one is being held accountable while Kash Patel and the FBI are off doing who knows what. The fix is straightforward but unglamorous: tighten oversight to stop the financial fraud and criminality, simplify the maze of regulations that invite abuse, tie government performance to results instead of spending, remove Governor White Teeth and aggressively address housing costs driving broader instability, over taxation, increasing energy costs, fuel taxes and a state government in Sacramento who are clearly out of control.
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Inside Gavin Newsom's empire of fraud

By Christopher Rufo and Ryan Thorpe | April 1, 2026

California is a cash machine.

The state collects some of the country's highest income, business, and fuel taxes, and now spends more than $300 billion per year.

And yet, everywhere you look, California seems to be falling apart.

 

The roads are crumbling. Mismanaged wildfires have turned neighborhoods into ash. Drug addiction and homelessness have metastasized, turning parts of Los Angeles and San Francisco into no-go zones.

And the cost-of-living crisis is pricing middle-class taxpayers out of basic necessities like groceries and gas, even as the state spends billions on welfare programs that never seem to lift anyone out of poverty.

Californians are beginning to ask: Where is all this money going?

On paper, it funds public services. But beneath the surface, something else is happening: massive, systematic, brazen fraud.

We conducted interviews with public officials, fraud experts, and political figures, and reviewed hundreds of pages of government reports, state audits, criminal indictments, and other public records on California fraud.

Seemingly every state program has been compromised by criminals.

The best estimates suggest that, on the governor's watch, fraudsters, scammers, and organized crime rings have stolen at least $180 billion from taxpayers.

Welcome to Gavin Newsom's empire of fraud.

Fourteen months after Newsom began his first term as governor, the COVID-19 pandemic swept the world. The state's leaders imposed some of the country's most restrictive public-health measures. In response to the crisis, Newsom sought to dump pallets of cash across the state — as quickly as possible.

One way to inject money was through California's massive unemployment insurance program (UI). Unemployment insurance is administered by the state's Employment Development Department (EDD), which can process billions of dollars in payments monthly. Before the state turned on the cash machine, however, experts had warned that the system was ripe for fraud.

Haywood Talcove, one of America's leading fraud specialists and CEO of LexisNexis Risk Solutions for Government, said:

"I was begging [federal officials] not to let the money go out like that, because it was going to be the biggest fraud in the history of our country. Obviously, I wasn't successful."

For many reasons, California was particularly susceptible to the large-scale fraud schemes that Talcove foresaw.

Please go to the New York Post to continue reading.

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