[Redacted] Plaintiffs' Additional Statement of Facts in Opposition to Motion for… — Bofa Ca Unemployment (Dkt. 652.2)

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U.S. District Court for the Southern District of California · No. 3:21-md-02992-GPC-MSB · Doc. 652-2 · 2026-02-03 · Docket on CourtListener

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Plfs’ Additional Statement of Facts; Case No. 3:21-md-02992-GPC-MSB 
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JOSEPH W. COTCHETT (SBN 36324) 
jcotchett@cpmlegal.com 
BRIAN DANITZ (SBN 247403) 
bdanitz@cpmlegal.com 
KARIN B. SWOPE (Pro Hac Vice) 
kswope@cpmlegal.com 
VASTI S. MONTIEL (SBN 346409) 
vmontiel@cpmlegal.com 
CAROLINE A. YUEN (SBN 354388) 
cyuen@cpmlegal.com 
COTCHETT, PITRE & McCARTHY, LLP 
840 Malcolm Road, Suite 200 
Burlingame, CA 94010 
Telephone: (650) 697-6000 
Fax: (650) 697-0577 
MICHAEL RUBIN (SBN 80618) 
mrubin@altber.com 
STACEY M. LEYTON (SBN 203827) 
sleyton@altber.com 
CONNIE K. CHAN (SBN 284230) 
cchan@altber.com 
JAMES BALTZER (SBN 332232) 
jbaltzer@altber.com 
KATHERINE BASS (SBN 344748) 
kbass@altber.com 
ALTSHULER BERZON LLP 
177 Post Street, Suite 300 
San Francisco, CA 94108 
Telephone: (415) 421-7151 
Fax: (415) 362-8064 
Co-Lead Counsel for Plaintiffs and the Class 
UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF CALIFORNIA 
IN RE BANK OF AMERICA 
CALIFORNIA UNEMPLOYMENT 
BENEFITS LITIGATION 
Case No. 3:21-md-02992-GPC-MSB 
PLAINTIFFS’ ADDITIONAL 
STATEMENT OF FACTS IN 
OPPOSITION TO MOTION FOR 
PARTIAL SUMMARY JUDGMENT 
[ORAL ARGUMENT REQUESTED] 
This Document Relates to All Actions 
Date: 
April 17, 2026 
Time: 
1:30 p.m. 
Judge: 
Hon. Gonzalo P. Curiel 
Ctrm: 
2D (2nd Floor) 
REDACTED PUBLIC VERSION
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Plfs’ Additional Statement of Facts; 
Case No. 3:21-md-02992-GPC-MSB 
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TABLE OF CONTENTS 
Page 
A. The Bank Performed A Governmental Function And Engaged In 
Joint Action With EDD .............................................................................................. 1 
B. The Bank Owed A Fiduciary Duty To Edd Cardholders, Whom 
The Bank Knew Were Particularly Vulnerable ......................................................... 3 
C. The Bank Knew Its CFF-1 Claim Denial And Credit Rescission 
Policies Were Inconsistent With Its Reg E Obligations And 
Would Erroneously Deny Valid Claims .................................................................... 3 
D. The Bank Was Capable Of Manually Investigating All ATM 
Claims In Accordance With Reg E ............................................................................ 6 
E. 
The Bank Chose Not To Comply With Reg E And Instead To 
Implement Its CFF Policies Of Automatic Claim Denials And 
Credit Rescissions Because Its Priority Was Reducing Its Reg E 
Liability-Related Operational Losses......................................................................... 7 
F. 
The Bank Knew CFF-1 Would Wrongly Deny Valid Claims Yet 
Made No Attempt To Assess Or Validate The Accuracy Of CFF-
1 In Identifying Fraud, Either Before Or After Implementation ............................. 11 
G. The Bank’s Senior Leaders Directed, Authorized, And Ratified 
The Bank’s CFF-1 Policies ...................................................................................... 13 
H. The Bank’s Senior Leaders Dismissed Employee Concerns And 
Maintained The CFF-1 Policies Despite Mounting Evidence Of 
CFF-1’s Inaccuracy And Harmful Consequences ................................................... 15 
I. 
The Bank Intentionally Adopted Its CFF-1 Policies Over Other 
Reasonably Available Alternatives .......................................................................... 18 
J. 
The Bank Deliberately Understaffed Its Claims Call Center To 
Create Long Wait Times .......................................................................................... 20 
K. The Bank Deliberately Delayed Issuance Of EMV Chip Cards 
For Self-Interested Financial Reasons ..................................................................... 22 
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Plfs’ Additional Statement of Facts 
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Pursuant to Fed. R. Civ. P. 56(c) and this Court’s Civil Pretrial & Trial Procedures, 
Plaintiffs respectfully submit this additional statement of facts (“PASF”) in opposition to 
Defendant Bank of America’s Motion for Partial Summary Judgment.1 
PLAINITFFS’ ADDITIONAL STATEMENT OF FACTS 
A. THE BANK PERFORMED A GOVERNMENTAL FUNCTION AND 
ENGAGED IN JOINT ACTION WITH EDD 
1. The California Employment Development Department (“EDD”) administers the 
issuance of unemployment insurance (“UI”), disability benefits, and other public benefits 
(collectively, “EDD benefits”) in California. From 2010 to 2024, EDD delegated to Bank 
of America (the “Bank”) the authority to administer the distribution of UI and other EDD 
benefits to beneficiaries in California via electronic payment services.   
PX 33; PX 34. 
2. From 2010 until 2024, the Bank had the exclusive contractual right and duty to provide 
electronic benefits payment services for EDD. During that time, EDD beneficiaries did not 
have the option of receiving electronic benefits payments (“EBP”) via direct deposit into 
their own personal banking account, nor did they have the option of receiving EBP via a 
debit card issued by any other bank or financial institution other than Bank of America. 
PX 13 (Chestnut) 75:4-13; PX 33 at 16; PX 34; PX 35 at -187054, 187057.  
3. In 2020 and 2021, EDD’s website presented Bank-issued debit cards as the exclusive 
means to receive EDD payments, and both EDD and the Bank promoted the benefits of 
receiving EDD benefits via a Bank-issued debit card. 
PX 36; PX 37; PX 38. 
4. The Bank’s prepaid debit card was the default method of receiving EDD benefits. 
Requesting payment by check required affirmatively contacting EDD to make that request, 
and that option was neither well publicized nor easily accessed. As a result, the vast 
majority (
) of EDD benefits recipients received benefits by debit card.  
PX 39 at -153670; PX 13 (Chestnut) 136:2-21; PX 40 (Rivera) 61:2-6; PX 41 (McClure) 
81:16-20. 
5. Under the EDD-Bank Contract, Bank-issued debit cards and associated accounts could 
receive deposits only from the EDD, not from any other source.  
PX 33 at 233. 
6. The EDD-Bank Contract required the Bank to work jointly with EDD in identifying and 
investigating potential benefits enrollment fraud. The Bank contractually agreed, “Upon 
detection of suspicious circumstances (such as recipient spending time in prison), the fraud 
team will flag the account for further review. Our fraud team will contact EDD’s 
Investigation Division to alert you of the possibility of benefits enrollment fraud and allow 
you to conduct further investigation.” 
 
1 PX # are exhibits to the Declaration of Connie Chan in Opposition to BANA’s Mot. for 
Partial Summary Judgment. 
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Plfs’ Additional Statement of Facts 
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PX 33 at 253. 
7. The Bank promised, in the EDD-Bank Contract, to engage in efforts with EDD to 
“[c]ombat[] fraud with proactive initiatives and ongoing communication,” including 
quarterly and bi-weekly meetings with EDD. EDD required the Bank to provide personnel 
“to work with … EDD … to assist in [fraud] investigation, detection, deterrence and 
prevention activity,” and to “cooperate with the EDD’s Investigation Division and/or its 
contractors with regard to fraud investigations to the extent permissible by law.” 
PX 33 at 8, 251-52.  
8. During 2020-2021, the Bank and EDD were engaged in an ongoing and jointly 
undertaken process to detect suspected benefits enrollment fraud, freeze accounts, and 
require re-verification as a condition of regaining access to benefits. 
PX 42; PX 29 (EDD) 50:21-54:20; PX 13 (Chestnut) 105:9-21, 146:17-25; PX 20 
(Garfield) 46:2-6, 47:16-48:2; PX 15 (Letson) 79:5-80:18; PX 280 at -169161; PX 281 at 
-71120. 
9. In September 2020 (pre-CFF), the Bank provided EDD 
 
 
 
 
 
 
 
 
. 
PX 43 at -452826; PX 15 (Letson) 118:2-125:23, 130:5-132:5; PX 22 (Fox) 36:8-25; PX 
44 at -421427; PX 42 at -71233.  
10. On September 28, 2020 and the following days, the Bank used its CFF to make benefits 
enrollment determinations and to freeze approximately 
 prepaid UI accounts. The 
Bank later unfroze most of those accounts 
, but only after first clawing 
back any previously paid credits. 
PX 13 (Chestnut) 107:10-110:10, 110:14-113:17, 114:24-115:13, 116:21-118:22; PX 45 
at -71588; PX 46 at -705534; PX 47 at -139424 (“
 
 
 
”); PX 280 at -169161; PX 283 at -631430. 
11. From December 3, 2020 to March 17, 2021, the Bank resumed using CFF-1 to make 
benefits enrollment fraud determinations and automatically froze the account of any EDD 
cardholder who submitted a claim that triggered CFF-1.  
PX 14 (Martin) 223:23-224:4; PX 266 at -159383.  
12.    On or about December 17, 2020, the Bank used CFF-1 to make benefits enrollment 
fraud determinations and froze the account of any EDD cardholder who had submitted a 
claim between October 4, 2020 and December 2, 2020 that triggered CFF-1 
 
. The Bank knew that 
 
. 
PX 48  at -77224; PX 14 (Martin) 221:1-224:4; PX 20 (Garfield) at 342:22-343:9; PX 266 
at -159383; PX 277 (
 
).  
13.  EDD and the Bank engaged in an ongoing and jointly undertaken process of requiring 
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Plfs’ Additional Statement of Facts 
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cardholders whose accounts the Bank froze based on CFF-1 to re-verify their eligibility 
with EDD as a condition of regaining access to their EDD benefits. 
PX 49 at -417556 
”); PX 29 
(EDD) 23:12-17, 53:4-9; PX 13 (Chestnut) 146:17-25; DX 5 ¶5; PX 14 (Martin) 226:17-
227:18, 232:2-12, 235:15-24; PX 16 (Golden) 149:10-21. 
14. The EDD-Bank Contract had a revenue-sharing agreement providing for a 50-50 split 
between the Bank and EDD on all “float revenue” (
 
), which 
, creating a relationship of 
financial interdependency between EDD and the Bank. The Bank also retained 
 of 
“interchange fees” and cardholder fees generated by the EDD prepaid card program.   
PX 33 at Attachment V1.1; RSUF 19; PX 13 (Chestnut) 45:25-47:23, 166:24-167:23, 
169:1-170:13; PX 20 (Garfield) 138:2-21; PX 5 (Regan Rpt) ¶¶61-62 & Schedule 2. 
B. THE BANK OWED A FIDUCIARY DUTY TO EDD CARDHOLDERS, 
WHOM THE BANK KNEW WERE PARTICULARLY VULNERABLE 
15. The EDD-Bank Contract expressly required the Bank to maintain one or multiple “trust 
account[s]” with “funds held ‘in trust’” “for the cardholders.”  
DX 39 at -2518. 
16. UI recipients are a highly vulnerable and financially precarious group. UI is a critical 
safety net program provided by the government to ensure that individuals who lose their 
job can afford food, health care, transportation, housing, and other life necessities. The 
typical UI recipient does not have enough savings to cover their essential expenses during 
unemployment and relies on UI benefits to pay for their daily living expenses. 
PX 7 (East Rpt) ¶¶8-9, 11-15. 
17. EDD cardholders rely on their EDD benefits to “
” 
The Bank recognizes that EDD cardholders “
 
”  
PX 15 (Letson) 100:13-22; PX 13 (Chestnut) 128:14-129:15; PX 50  at -153421 (“
 
 
 
”); e.g., PX 51; PX 52; 
PX 53; PX 54; PX 55.  
C. THE BANK KNEW ITS CFF-1 CLAIM DENIAL AND CREDIT RESCISSION 
POLICIES WERE INCONSISTENT WITH ITS REG E OBLIGATIONS AND 
WOULD ERRONEOUSLY DENY VALID CLAIMS 
18. 
 under the EDD-Bank Contract, the Cardholder Agreement, and 
EFTA and Reg E, it was required to reimburse EDD cardholders for any unauthorized 
transactions on their EDD debit card, including unauthorized ATM transactions. Under the 
EDD-Bank Contract, the Bank promised EDD it would (i) follow “[a]ll Regulation E 
requirements and timelines” for resolving “dispute claims by a claimant” and (ii) offer 
Cardholders “Zero Liability” for “unauthorized use of debit cards or debit card accounts,” 
“including ATM and pinned POS [point of sale] transactions.” 
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PX 33 at 8, 175, 199; PX 34 at –518187; PX 13 (Chestnut) 88:9-14; PX 56 §§10-11. 
19. 
 it was required to investigate EDD cardholders’ claims and to 
provide cardholders with provisional credit within 10 business days of claim submission 
if the Bank could not complete its investigation and make a final decision within that time. 
 any provisional credit paid on an ATM or ATM/combo claim was to 
be made a permanent credit on the 45th day after claim submission, unless the Bank had 
determined based on a reasonable and good faith investigation that the cardholder had in 
fact authorized the transaction. 
PX 33 at 8, 199 (“Per Regulation E, within 10 business days of the initial dispute, we will 
promptly correct the error.”), 232, 235, 253; PX 27 (Montag) 128:18-22; PX 20 (Garfield) 
at 86:24-87:17; PX 57 at -167414; PX 24 (Ehresman) 34:8-35:18; PX 18 (Johnson) 8:18-
24; PX 12 (Daniels) 31:17-32:10, 199:10-200:13. 
20. Before implementing its CFF-1 policies on September 28, 2020, the Bank’s standard 
practice had always been to 
 
 
(“
”) and to make a pay or deny decision or to issue provisional credit within 10 
business days of claim submission. The Bank’s 
 were consistent with industry 
standards and reflected the Bank’s understanding of “
 
” 
PX 12 (Daniels) 123:7-21, 124:24-125:6, 133:16-134:11, 135:21-136:10; PX 58 at -1312 
(AISOP); PX 59 at -4543; PX 60; PX 24 (Ehresman) 17:8-19:12; PX 1 (Kreis Rpt) ¶¶27-
41. 
21. To ensure that the Bank’s claims analysts would review all relevant records, 
 
 
 
  
PX 12 (Daniels) 120:16-121:1, 122:24-123:6, 147:16-150:11.  
22. Within each claim type, 
 
 
”  
PX 59 at -4539, -4549; PX 12 (Daniels) 137:9-25, 147:21-151:20; PX 1 (Kreis Rpt) ¶¶31-
36. 
23. The Bank’s training materials emphasize that 
 
 
 
”  
PX 59 at -4542, -4543 (
”); PX 12 
(Daniels) 136:11-24, 141:14-142:15; PX 61; PX 62. 
24. 
 absent evidence that the cardholder authorized the disputed 
transaction, the Bank was required to provide permanent credit in the amount of the claim, 
”  
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Plfs’ Additional Statement of Facts 
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PX 63 at -290332; PX 12 (Daniels) 202:23-203:13; PX 15 (Letson) 245:25-246:5, 248:25-
249:14. 
25. The Bank’s 
 
 
 
 
.  
PX 1 (Kreis Rpt) ¶¶34-37; PX 60 (AISOP) at -559893–901. 
26. The 
 
 
 
 
 
 
 
. 
PX 1 (Kreis Rpt) ¶¶34-36; PX 60 (AISOP) at –559893-95, -559898–901. 
27. 
 
 
 
 
 
 
 
 
 
PX 60 (AISOP) at -00559897, -559901 (“Use as supporting only”); PX 12 (Daniels) 
138:14-140:4; PX 1 (Kreis Rpt) ¶¶38-39. 
28. 
 EFTA and Reg E prohibited the Bank from rescinding credits 
issued on an ATM claim more than 45 days after notice of the claim or after the Bank had 
already informed the claimant that provisional credit had been made permanent, whichever 
came first.  
See, e.g., PX 64 at -169954–56 (“
 
”); PX 18 (Johnson) 49:18-50:8. 
29. 
 the CFF indicators 
 
denying ATM and ATM/combo claims based solely on CFF-1 would result in erroneous 
denials of valid claims by legitimate EDD cardholders. 
PX 22 (Fox) 49:23-50:2 (“
 
 
”); PX 14 (Martin) 103:7-14, 308:9-18 (“
 
”); PX 65 at -630750); PX 21 
(Ahmad) 64:25-65:15, 69:14-17; PX 66 at -169914; PX 23 (Holt) 134:5-135:23, 138:10-
140:5.  
30. 
 due to its own decision not to issue EMV chip cards, EDD 
cardholders were particularly vulnerable to skimming and card-present counterfeit fraud 
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such as unauthorized ATM withdrawals—the precise type of claim that CFF-1 would 
automatically deny.  
See PASF 109-112, 117; PX 21 (Ahmad) 50:22-52:16; PX 15 (Letson) 155:24-157:5, 
164:6-165:10. 
31. 
 CFF-1 could not distinguish between valid claims submitted by 
legitimate cardholders and fraudulent claims submitted by criminals engaged in benefits 
enrollment fraud using stolen identities. 
 the only way to differentiate 
between the two categories was to conduct a manual investigation of each claim, including 
 
 
 
  
PX 278 at –87719 (“
 
 
”); PX 19 (Schwartz) 108:7-110:18; PX 14 (Martin) 286:25-288:8; PX 23 
(Holt) 103:14-25, 127:9-25) 
D. THE BANK WAS CAPABLE OF MANUALLY INVESTIGATING ALL ATM 
CLAIMS IN ACCORDANCE WITH REG E 
32. Because the Bank, before July 2021, issued all EDD cardholders magstripe-only cards 
that did not have an EMV chip, EDD cardholders were vulnerable to skimming and card-
present counterfeit fraud, which led to 
 
See PASF 109-119; PX 21 (Ahmad) 78:12-79:16; PX 247 at -372043. 
33. Under the applicable Visa liability shift rules, losses from  unauthorized ATM 
transactions on the Bank’s mag-stripe-only cards 
 
 Had 
the Bank issued EMV chip cards to EDD cardholders, the EMV chip would have prevented 
counterfeit fraud at chip-enabled points of transaction (including the vast majority of 
ATMs), and under the Visa liability shift rules, 
 
 
 
See PASF 109-119; PX 2 (Cloninger Rpt) ¶49; PX 24 (Ehresman) 29:3-30:8, 30:18-32:10; 
PX 67  at -416779 (
 
 
 
”); PX 68 at -701418-19. 
34. 
 
 
 
, which would have enabled the Bank to determine which claims were 
valid and which were fraudulent claims submitted by criminals engaged in benefits 
enrollment and identity theft before having to pay any provisional or permanent credit. 
CR&R, as the Bank’s Reg E experts, understood that “
 
 
” 
PX 67 at -416779; PX 69; PX 24 (Ehresman) 34:8-35:18.  
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35. The head of the Bank’s claims processing division, Renee Johnson, estimated that the 
 
  
PX 70 at -426407. 
36. On September 17, 2020, 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PX 69 at -225377; PX 71 at -181662; PX 18 (Johnson) 65:8-17, 69:5-8. 
37. The Bank 
 
 
 
 
 
” 
PX 24 (Ehresman) 34:8-36:2, 36:14-38:6, 97:4-23 (confirming that “
 
 
); PX 70 
at -426407 (
); PX 28 
(Moynihan) 238:16-239:2 (
”). 
38. CR&R’s 
 
 
 
 
 
 
. 
PX 69 at -225375; PX 18 (Johnson) 195:17-197:23; see PASF 40-75, 87-95. 
E. THE BANK CHOSE NOT TO COMPLY WITH REG E AND INSTEAD TO 
IMPLEMENT ITS CFF POLICIES OF AUTOMATIC CLAIM DENIALS AND 
CREDIT RESCISSIONS BECAUSE ITS PRIORITY WAS REDUCING ITS REG 
E LIABILITY-RELATED OPERATIONAL LOSSES 
39. Under the EDD-Bank Contract, the Bank (not the State) was solely liable for any losses 
due to transaction fraud on EDD debit cards (also known as “fraud losses”). 
PX 33 at 8 (“Bank of America is responsible for external transaction fraud on cards that 
we issue”), 142 (“EDD shall not be liable for … fraud, misuse, and/or lost or stolen debit 
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cards.”), 235 (“The [Bank] shall not charge the EDD for … fraud, misuse, and lost or stolen 
debit cards.”), 253; PX 63 at -290330; PX 13 (Chestnut) 87:21-88:14. 
40. The EDD card program was part of the Bank’s Global Transaction Services (GTS) 
group, run by Faiz Ahmad, which was part of the Global Banking and Markets (GBAM) 
division, run by then-COO Thomas Montag. 
 
 
 
 
 
 
 
 
PX 27 (Montag) 6:18-7:16; PX 28 (Moynihan) 25:1-26:5, 36:1-5, 51:7-23; PX 20 
(Garfield) 98:16-101:20, 103:2-6. 
41. During the spring and summer of 2020, 
 
 
 
 
 
 
 
 
 
 
 
 
” 
PX 68 (-701418) (
 
 
); PX 268 at -171973; PX 27 (Montag) 15:8-16:13, 113:18-114:6, 115:14-
22, 116:12-14; PX 282 (“
”). 
42. The Bank created a 
 
 
 
 
 
 
 
  
PX 72 at 8-9 (Rog 35 Resp.); PX 24 (Ehresman) 22:22-24:13.  
43. COO Tom Montag 
 
 
 
 
 
 
 
 
 
 
PX 27 (Montag) 9:23-10:7, 10:18-11:16, 12:7-14, 123:23-124:12, 125:8-11; PX 28 
(Moynihan) 25:1-27:2, 43:2-11; PX 21 (Ahmad) 27:11-28:11. 
44. 
 which in 2020-21 
 CEO and Bank 
Chairman Brian Moynihan and his direct reports, including then-COO Thomas Montag, 
Cathy Bessant, Paul Dinofrio, Dean Athanasia, and Chief Risk Officer Geoffrey Greener. 
PX 28 (Moynihan) 9:24-10:3, 16:7-23, 27:22-28:2; PX 27 (Montag) 7:5-8:16; PX 21 
(Ahmad) 27:11-28:11; PX 26 (Simpson) 13:22-14:2; PX 22 (Fox) 21:25-22:13; PX 24 
(Ehresman) 52:13-53:24. 
45. Starting in mid-August 2020, the Bank’s projected fraud losses in the UI card program 
 
” As of August 14, 2020, the projected losses 
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for November were $
—
 
”  
PX 73 at -706201; PX 202 at -706213; PX 20 (Garfield) 119:6-122:14 (
 
”), 125:19-126:17; PX 203 at 
-140413 (“
  
 
”); 
PX 270 at -883608–09 (
 
 
”).  
46. By mid-September 2020, the Bank’s projected losses in the UI card program 
 
 
” Chief Risk Officer Geoffrey Greener knew 
that 
 
 
 
 
 
 
”  
PX 74 at -371658–59; PX 75 at -695594. 
47. The Bank’s senior leaders directed their subordinates to develop a claims-screening 
mechanism that would enable the Bank “
 
” and to stop issuing credit on certain claims.  
PX 76 at -630836; PX 77 at -371977; PX 271 at -874614–15. 
48. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
49. GBAM turned to GFC to develop an automated “filter” that the Bank could use to 
automatically deny claims and rescind credits without a manual adequate investigation. 
Late on Friday, September 18, 2020, 
 
 
 
 
 
 
 
 
” i.e. on September 21, 2020. 
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PX 76 at –630836; PX 19 (Schwartz) 126:9-127:17, 137:21-138:16; PX 23 (Holt) 119:23-
120:14.   
50. GBAM instructed GFC to create a “
 
 
 
 
. 
PX 76 at -630836; PX 23 (Holt) 117:7-19. 
51. On Sunday, September 20, 2020, 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 GFC analyst Ryan Schwartz, who conducted and 
presented the analysis, testified that 
 
 
 
 Schwartz testified that “
 
 
 
”  
PX 79 at -630837; PX 19 (Schwartz) 152:5-155:8, 173:3-175:12, 178:3-183:18 (  
 
; PX 80 at -
125014; PX 15 (Letson) 236:25-238:20, 241:9-24, 243:20-244:7. 
52. GBAM/GTS leaders 
 
” Instead, “
 
 which was the screening thresholds that would 
capture 
 GBAM/GTS “
 
 
” “
 
. The selected criteria became CFF-3. 
PX 80 at -125014; PX 19 (Schwartz) 152:5-155:8, 178:3-183:18, 214:14-216:15; PX 79 
(“
”); 
PX 81 at -87749–50 (“
 
”); PX 66 at -169914 (“
 
 
”).  
53. After the September 20 meeting, GFC (Schwartz) provided GBAM additional 
information showing that 
 
 
” 
Nevertheless, 
 
 for Indicator 3. When it 
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later adopted CFF-1 (see PASF 57-66), the Bank did not apply any minimum dollar 
threshold to CFF-1. 
PX 79 at -630837; PX 19 (Schwartz) 158:23-162:25; PX 290 at 8 (Rog 28 Resp.).  
54. On September 21, 2020, the chief officers learned 
 
 
 
 
 
 
” The chief officers 
immediately briefed CEO Moynihan on 
, which were “
 
 
 
 
” 
PX 82 at -372013; PX 28 (Moynihan) 66:4-67:23; PX 83 -118367; PX 44 at -421427.  
55. With the next board meeting approaching on 
 and the CEO’s 
 
, the Bank’s senior officers intensified their pressure on subordinates 
to “
 in the prepaid UI program. That same day (September 
21), Montag directed Ahmad and Lawlor to “
 
” 
PX 77 at -371977; PX 27 (Montag) 96:10-97:3, 110:18-111:6; PX 28 (Moynihan) 28:18-
29:25. 
56. The next day, Lawlor told other managers he was “
 
” and that “
”  
PX 84 at -694889-90. 
F. THE BANK KNEW CFF-1 WOULD WRONGLY DENY VALID CLAIMS YET 
MADE NO ATTEMPT TO ASSESS OR VALIDATE THE ACCURACY OF CFF-1 
IN IDENTIFYING FRAUD, EITHER BEFORE OR AFTER IMPLEMENTATION 
57. Following the directive that “
 
 
 
 
 
 
” In addition to the multi-factored CFF-3, the proposed CFF included 
CFF-1, which would “
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
PX 85 at -125059; PX 86 at -170046; PX 87 at -87766 (“
 
”), -87767 (“
”); PX 3 (Holt) 192:22-
194:20; PX 19 (Schwartz) 204:10-205:20; see PASF 61-62. 
58. The CFF proposal was updated 
 
 
 
 
 
 
 
 
 
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2
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19
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21
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27
28
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 (which would become part 
of CFF-3). 
PX 262 at -87776; PX 88 at -87780; PX 91 at -87760; PX 19 (Schwartz) 199:25-208:21. 
59. The final version of the CFF was 
 
”   
PX 135 at -125177; PX 90 at -450517. 
60. On the final version of the CFF proposal 
 
 
 
. The Bank conducted no analysis as to what percentage of those ATM claims were 
actually fraudulent. 
PX 90 at -450517; PX 91 at -87760; PX 19 (Schwartz) 199:25-208:21, 211:25-214:24; PX 
20 (Garfield) 173:6-22, 271:23-278:1, 282:4-23; PX 15 (Letson) 199:22-201:7; PASF 57-
58, 61-62. 
61. No one at GFC (or anyone else at the Bank) ever analyzed 
 
 
. 
PX 23 (Holt) 92:6-19, 180:15-181:16, 191:3-194:20, 275:11-276:4; PX 19 (Schwartz) 
37:20-38:20, 108:7-110:18, 201:11-205:20, 212:3-214:24, 260:6-263:16, 265:4-15; PX 92 
at -881824; PX 15 (Letson) 144:11-145:3, 170:7-176:14, 179:9-180:16; PX 22 (Fox) 
53:10-21; PX 21 (Ahmad) 68:14-16; PX 20 (Garfield) 173:6-22, 271:19-278:1, 282:4-23. 
62. Bill Fox, Michael Letson, Anne Holt, and Ryan Schwartz were the GFC personnel who 
worked on developing the CFF indicators. Schwartz was 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
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Case No. 3:21-md-02992-GPC-MSB 
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9
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11
12
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PX 19 (Schwartz) 37:20-38:20, 72:2-8, 77:3-7, 77:22-24, 108:7-110:18, 201:11-205:20, 
212:3-214:24, 260:6-263:16, 265:4-15. 
63. 
 CFF-1 would incorrectly deny legitimate cardholders’ valid ATM 
and ATM/combo claims, particularly because the Bank-issued mag-stripe-only cards were 
highly susceptible to skimming and card-present counterfeit fraud, including unauthorized 
ATM transactions. 
 
 
 
 
 
  
PX 22 (Fox) 49:23-50:6; see PASF 109-112, 117; PX 14 (Martin) 127:8-132:15, 287:14-
288:8; PX 43 at -452826 (“
 
 
 
”); PX 19 (Schwartz) 178:3-183:18, 201:11-205:20; 212:3-214:24; PX 23 
(Holt) 161:24-162:25; 179:5-181:16; PX 21 (Ahmad) 64:25-65:15, 68:14-16; PX 93 (Rog 
28 Resp.) at 8; PX 14 (Letson) 170:7-176:14; PX 105 at -100644–70 (
 
 
 
 
); PASF 29-31. 
64. The Bank was aware that using the CFF to summarily deny claims would 
 
 The Bank also 
knew that denying cardholders of access to their EDD benefits without notice and hearing 
would 
 
PX 66 at -169912 (“
 
 
– 
 
 ….”); PX 95 at -429789 (“
 
 
 
”); PX 18 (Johnson) 78:10-81:10; PX 78 at -57708; PX 277. 
65. 
 despite having 
 
 of CFF-1 in identifying fraud. 
PX 27 (Montag) 17:14-19:8, 56:5-57:4; PX 22 (Fox) 81:1-82:1, 82:7-83:8; see PASF 60-
63, 68. 
66. After the CFF was implemented, 
 
 
 
.  
PX 19 (Schwartz) 260:6-263:16, 265:4-15 (
 
); PX 15 (Letson) 312:4-313:14 (
 
 
); PX 24 (Ehresman) 92:23-93:14 (
). 
G. THE BANK’S SENIOR LEADERS DIRECTED, AUTHORIZED, AND 
RATIFIED THE BANK’S CFF-1 POLICIES 
67. “
 including CEO Brian T. Moynihan, then-COO Thomas Montag, 
Cathy Bessant, Paul Dinofrio, Dean Athanasia, and Chief Risk Officer Geoffrey Greener, 
were executive officers of the Bank. 
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PX 28 (Moynihan) 9:24-10:3, 16:7-23, 27:22-28:2; PX 27 (Montag) 6:18-8:16; PX 21 
(Ahmad) 26:7-19; PX 22 (Fox) 21:25-22:13; PX 24 (Ehresman) 52:13-53:24. 
68. In addition to executive officers, “
” (i.e. direct reports to the CEO’s direct 
reports), and others with comparable levels of responsibility within their units, 
 
 
 
 
. During 2020-21, this included Faiz Ahmad, 
who ran GTS (which included the prepaid UI card program); Brad Garfield, who was 
responsible for overseeing the GTS prepaid product development team; John Lawlor, who 
was responsible for public sector banking; Paul Simpson, who was responsible for the 
Bank’s call centers servicing prepaid cardholders; William Fox, who was head of GFC; 
Michael Letson, who was head of financial crimes analytics within GFC; Jennifer 
Ehresman, who was head of Consumer Client Protection; and Renee Johnson, who ran the 
Claims Resolution & Recovery unit. 
PX 28 (Moynihan) 21:7-23, 23:1-19, 25:1-26:5 (
), 27:12-21 (
 
), 41:6-24, 83:5-15, 86:1-2, 133:25-134:21, 138:4-139:13, 187:1-188:25, 235:8-15; 
PX 21 (Ahmad) 21:10-22:2; PX 20 (Garfield) 25:24-29:4, 35:4-37:18; PX 26 (Simpson) 
9:12-11:5, 13:22-14:4; 16:7-17; PX 22 (Fox)  12:15-21, 13:1-23, 71:11-20; PX 15 (Letson) 
37:1-9, 52:4-23 (
), 257:14-20, 258:10-16; PX 
24 (Ehresman) 11:22-12:23, 14:20-16:19 (
), 
22:22-24:17, 36:14-37:5, 41:1-42:1; PX 18 (Johnson) 7:4-10; PX 17 (Lennon) 192:1-
192:23; PX 285.  
69. 
 
. 
PX 96 at -706496 (
 
”); PX 272 at -163799 (“
 
”); PX 276 at -714621 (
 
”). 
70. 
 
. 
PX 97 at -876417 (“
 
”); 
PX 21 (Ahmad) 193:8-15, 195:8-18; PX 27 (Montag) 7:5-8:14, 82:10-18. 
71. 
 
 
 
PX 98 at -293818 (S
 
 
”), -29319-20 (
 
 
 
”); PX 99 at -162397 (
 
”); PX 22 (Fox) 64:21-66:13 (
 
 
), 68:10-71:10, 71:11-23 (
 
 
”); PX 100 (
 
 
 
”). 
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72. At 
 
 
 
 
.  
PX 101 at -497802 (
), 497804 (“
 
”); PX 27 
(Montag) 12:15-24 (
 
 
 
”), 30:13-20 (
, 
47:19-48:16, 128:7-11); PX 28 (Moynihan) 16:24-19:24 (
 
). 
73. In an 
 
, 
Moynihan provided an update on “
” At 
the 
 
 
 
 
 
 
 
 
 
” The Board allowed the CFF policies to proceed. 
PX 103 at -882978 (CEO Memo; content redacted for attorney-client privilege); PX 104 
at -882713 (
 
); PX 27 (Montag) 
23:25-24:20, 28:25-29 (
 
); PX 28 
(Moynihan) 28:18-29:25; PX 102 at -878451 (
”). 
74. The Board continued to be updated regularly on 
 
 
 
 
” and permitted the CFF-1 policies to continue until enjoined by a federal court. 
On January 20, 2021, executive risk committee board members were notified of a “
 
 
” Board risk committee members 
were informed that “[
 
 
” 
PX 102 at -878451; PX 270 at -883608–09; PX 271 at -874614–15; PX 209; PX 210. 
H. THE BANK’S SENIOR LEADERS DISMISSED EMPLOYEE CONCERNS 
AND MAINTAINED THE CFF-1 POLICIES DESPITE MOUNTING EVIDENCE 
OF CFF-1’S INACCURACY AND HARMFUL CONSEQUENCES 
75. After CFF-1, the Bank was inundated with calls from cardholders seeking 
reconsideration of claims that had been summarily denied without explanation.  
PX 105 at -100641 (“
 
 
”), -100644 (“
 
 
”); PX 106 at -158953; PX 12 (Daniels) 252:5-
10, 253:10-25 (
 
 
. 
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76. If a cardholder succeeded in contacting the Bank’s Claims Call Center and requested 
reconsideration of their CFF-denied claim, and the Bank actually investigated the claim on 
reconsideration (rather than summarily denying the claim again based on the CFF, as it did 
for cardholders whose accounts were also frozen based on the CFF), the Bank’s CR&R 
department 
 
 
. 
 
 
 
. 
PX 24 (Ehresman) 90:9-17; see generally PX 105 (
 
; PX 267; PX 18 (Johnson) 191:8-12. 
77. Although many cardholders were unable to get through to the Claims Call Center to 
request reconsideration, of those who did, 
 
 
 
. 
PX 21 (Ahmad) 336:13-337:23; PX 15 (Letson) 292:9-298:8, 306:9-307:24; PX 107 at -
556536; PX 108 at -143393. 
78. The 
 CFF-1’s extraordinarily high false positive rate. 
As of December 11, 2020, the Bank’s data showed that approximately “
 
 
 
 
 
” 
 
 
. Of claims submitted January to March 2021, 
 
 
 
. 
PX 109 at -76994; PX 110 at -510145 (
 
); PX 24 (Ehresman) 87:24-89:16; PX 111 at -77127; PX 21 (Ahmad) 336:13-
337:23, 355:13-360:9 (
); PX 227 at -
159493; PX 1 (Kreis Rpt) ¶72 (“[S]uch rates are incredibly high and virtually unheard of 
in the industry.”).  
79. The Bank knew that wait times in its Claims Call Center were extraordinarily long 
from September 28 until November 21, leading many callers to give up before ever 
reaching a customer service representative (“CSR”). 
 a failure to 
seek reconsideration does not prove a claim was fraudulent and that there are many reasons 
a legitimate cardholder might not seek reconsideration of a CFF-denied claim. 
PX 21 (Ahmad) 359:8-360:14; PX 10 (Loebner Reb Rpt) ¶¶ 46-61; see PASF 96-108. 
80. The Bank’s mid-level managers were aware of the resulting harsh consequences on 
innocent cardholders and asked 
 
.” 
PX 14 (Martin) 308:9-311:15; PX 112 at -90640 (12/29/20: “
 
 
 
”); 
PX 113 at  -107261 (1/11/21: “
 
]); 
PX 274 at -62175 (1/14/21: “
 
); PX 114 at –107327 (
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”); PX 115 at -90683 (
 
 
”). 
81. Senior leaders dismissed concerns that the CFF-1 policies were harming legitimate 
cardholders. 
PX 116 at -273305 (
 
 
”). 
82. The Bank received thousands of calls from EDD cardholders seeking to regain access 
to CFF-denied or CFF-frozen funds. Many broke down in tears on the phone with the 
Bank’s CSRs, explaining the hardship caused by their denied accesss, sometimes for 
months on end. Cardholders explained that they relied on their EDD benefits to feed their 
families, pay rent, and buy diapers and other daily necessities, and that because they were 
unable to access those benefits, they were at risk of eviction or homelessness. One Bank 
CSR explained to the press, “We’re actually no longer allowed to tell them a timeframe 
[for when they’ll regain access to their funds], because we have no clue …. Every day, I 
talk to 30 people with the same story. I just pray for them after my shift, honestly.” 
PX 117; e.g., PX 51;  PX 53; PX 54; PX 55; PX 118;  PX 119; PX 120. 
83. On November 24, 2020, CEO Moynihan received a letter from all 56 California state 
legislators reporting that “[e]very legislative office in our state has experienced an 
unprecedented number of constituents contacting them requesting assistance to resolve 
issues with … their Bank of America debit cards. …. EDD reports to legislative staff that 
Bank of America has a proprietary formula to detect fraud and has taken it upon themselves 
to freeze cards and take money from recipients. … [C]onstituents report they are unable to 
get through to your call centers, or when they do, the issue is not resolved. Many of our 
own staff have also tried to reach Bank of America to no avail. It is simply unacceptable 
that Californians entitled to benefits are suddenly not able to obtain them due to a Bank of 
America determination that is impossible to appeal.” 
PX 121 at -58621. 
84. Moynihan 
 many communications from EDD cardholders harmed 
by the Bank’s CFF policies and seeking assistance in regaining access to their EDD funds. 
Many of these cardholders explained to Moynihan that they had tried calling the Bank’s 
call centers and EDD to no avail, that they were desperate to regain access to their funds, 
and that they relied on their EDD benefits to pay for food, rent, and other necessities.  
See, e.g., PX 28 (Moynihan) 143:25-147:21, 150:23-151:25, 152:5-18, 152:20-154:12,  
159:1-5, 169:19-171:23; PX 122 at -105556; PX 123 at -373787-88; PX 124 at -188717-
78; PX 125 at -105900; PX 51; PX 128 at -284155; PX 129 at -41664; PX 130 at -27088; 
; PX 131 at -41705; PX 132 at -27124; PX 133 at -41795; PX 134 at -27231-32; PX 135 
at -29021-22.  
85. In December 2020, the Bank knew that EDD “
 
” Shortly after resuming its CFF-1 account freeze policy, the Bank 
learned that CFF-frozen cardholders were unable to get unfrozen, even after reverifying 
with EDD, because they were stuck in a “
” of fruitless calls to EDD and 
the Bank who would each refer the cardholder to the other. Managers proposed as early as 
January 2021 that the Bank “
, yet the Bank delayed 
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until March 18, 2021 before changing to a “block” policy. 
PX 138 at -874570; PX 273 at -127438; PX 114 at -107328 (1/14/21: “
 
”); 
PX 275 at -646321 (1/21/21: “
 
 
”), -646333 (
 
 
 
 
; PX 136 at -90722, -90725; PX 137 at -452795; 
PX 14 (Martin) 302:2-303:23, 308:9-310:4. 
86. Once the Bank began to allow cardholders to authenticate their identities with the Bank 
after March 18, 2021, 
 
” Nevertheless, the Bank continued to use CFF-
1 to auto-deny all ATM claims until enjoined by a federal court. 
PX 289 at -406129; PX 209; PX 210. 
I. THE BANK INTENTIONALLY ADOPTED ITS CFF-1 POLICIES OVER 
OTHER REASONABLY AVAILABLE ALTERNATIVES 
87. On or about September 28, 2020, relying solely on CFF-1, the Bank clawed back nearly 
$
 in permanent credits that it had previously paid on ATM and ATM/combo 
claims submitted by approximately 6,100 Credit Rescission class members. The Bank’s 
rescission of previously paid credit on any claim that triggered CFF-1 was intentional. 
Approximately 
 of Credit Rescission class members were denied access to rescinded 
credits for more than 
. The median duration of credit rescission was 
. 
PX 64 at -169954–55; PX 139 ; PX 140 at -571310; PX 141 at -417490; DX 31 at No. 39; 
DX 76 at -7224; PX 24 (Ehresman) 72:1-72:15 (
 
 
 
”); PX 18 (Johnson) 60:20-24 (recalls “
 
”); PX 14 (Martin) 177:4-178:23, 
179:13-180:1; PX 5 (Regan Rpt) ¶¶65, 67-68 & Schedule 1; PX 284. 
88. From September 28, 2020 until June 8, 2021, the Bank relied solely on CFF-1 to auto-
deny without investigation or issuance of provisional credit all ATM and ATM/combo 
claims submitted by EDD cardholders and sending cardholders a form claim denial letter 
with no explanation of the reasoning for the denial. Pursuant to this policy, the Bank 
summarily denied without investigation the ATM and ATM/combo claims of 
approximately 104,300 Claim Denial class members, worth approximately $
. 
Approximately 
 of class members’ claims were not paid for more than 
. The 
median duration of deprivation for class members was 
 
PX 14 (Martin) 124:10-126:8, 127:20-132:17, 132:20-133:17; PX 5 (Regan Rpt) ¶¶37, 39, 
45 & Schedule 1; PX 284; PX 291; PX 155. 
89. Instead of automatically denying claims that hit the fraud filter, the Bank could have 
prioritize” ATM claims for investigation in accordance with 
 within 10 business 
days, 
. The Bank 
 
manually investigate all ATM and ATM/combo claims within 10 business days of claim 
submission, thereby complying with its Reg E obligations and not having to pay 
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provisional (or permanent) credit for fraudulent claims submitted by those engaged in 
benefits enrollment fraud. Nevertheless, the Bank deliberately chose to implement its CFF-
1 claim denial policy. 
PX 24 (Ehresman) 32:12-38:6, 97:4-23; PX 70 at -426407; PX 28 (Moynihan) 238:16-
239:2 (
”); PX 20 (Garfield) 199:9-201:15; PX 66 at -169914 
(
). 
90. From September 28 to October 3, 2020, and again from December 3, 2020 to March 
17, 2021, the Bank automatically froze the account of every EDD cardholder who 
submitted an ATM or ATM/combo claim; refused to allow such cardholders to 
authenticate their identity with the Bank and instead directed cardholders to call EDD’s 
call centers and authenticate their identity with EDD; and refused to unfreeze CFF-frozen 
accounts unless the EDD cardholder reverified their identity with EDD and EDD directed 
the Bank to unfreeze the account (“CFF-1 account freeze policy”). Pursuant to this policy, 
the Bank froze the accounts of approximately 65,800 Account Freeze class members, who 
were denied access to their frozen account balances totaling approximately $
. 
Approximately 
f Account Freeze class members were frozen for more than 
, 
and 
 were frozen for more than 
. 
PX 14 (Martin) 222:9-225:2, 232:2-12, 235:15-236:1; PX 142 (Simpson Ex 395) at -
845906-07; PX 49 at -41755 (
”); 
PX 29 (EDD) 23:12-23; PX 13 (Chestnut) 146:17-25; PX 5 (Regan Rpt) ¶¶77, 79, 83 & 
Schedule 1; PX 284. 
91. When the Bank implemented its CFF-1 account freeze policy requiring frozen 
cardholders to call EDD to authenticate their identity to regain access to their account, it 
knew that EDD’s call centers were overwhelmed and understaffed and unable to answer 
the vast majority of calls received.  
PX 13 (Chestnut) 154:11-157:14; PX 143 at 17-18; PX 144 at -71396 (“
 
”); PX 138 at -874570 (as 
of December 2, 2020, EDD “
”).  
92. Instead of using CFF-1 to freeze cardholder accounts and require reverification with 
EDD, the Bank could have 
 used CFF-1 to 
“block” cardholders and allowed them to authenticate their identities through the Banks’ 
own 
, which involve “
 
” 
PX 14 (Martin) 224:5-16, 242:22-247:2, 255:23-256:17; PX 145 (Bank’s Rog 34 
Response); see PASF 93. 
93. Prior to its CFF policies, the Bank had 
 
 
 
. Instead,  
 
 
 
 
 
 
 
 
 
  
 
 
 
 
PX 14 (Martin) 198:4-201:19, 205:1-206:8, 207:25-210:5, 236:13-25, 281:21-283:24, 
286:2-19; PX 15 (Letson) 220:20-222:3 (
”), 334:21-335:4; 
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PX 215 at -592330 (
 
 
”); PX 145 (Rog 34 Resp.). 
94. The Bank’s 
 is an effective tool for authenticating the true 
cardholder. The Bank also had numerous other sources of information for verifying the 
identity and transaction history of EDD cardholders, including information in the Bank’s 
possession for EDD cardholders who also had consumer accounts with the Bank, which 
the Bank estimated was approximately 
. 
PX 145 (Rog 34 Resp.) (
 
”); 
PX 25 (Ramirez) 23:5-8; PX 12 (Daniels) 155:23-156:21; PX 26 (Simpson) 84:15-85:4; 
PX 23 (Holt) 127:9-17, 276:13-277:1 PX 149 at -631445 (“[
 
 
 
].”); PX 14 (Martin) 30:25-31:3, 188:4-
190:16, 218:2-220:7, 268:2-4, 301:18-302:25; PX 1 (Kreis Rpt) ¶ 66; PX 8 (Kreis Reb. 
Rpt) ¶¶ 23, 36; PX 136 at -90723 (
 
 
”); PX 146 at -405160 (same); PX 147 at -169898 (“
 
 
”); PX 148 at -417556-57; PX 138 at -
125921; PX 273 at -127438. 
95. The Bank was capable of authenticating legitimate EDD cardholders and identifying 
individuals using a stolen identity through its 
 and other 
processes and resources, and was aware that its CFF-1 freeze policy was trapping 
cardholders in a “
,” but deliberately chose to implement and maintain its 
CFF-1 freeze policy until March 18, 2021. 
See PASF 85-86, 93-94. 
J. THE BANK DELIBERATELY UNDERSTAFFED ITS CLAIMS CALL CENTER 
TO CREATE LONG WAIT TIMES 
96. The Bank required EDD cardholders to call the telephone number on the back of their 
EDD debit card to report an unauthorized transaction (i.e. file a claim). 
PX 56 §§10-11; PX 33 §V at 198 (“Claims initiation can only be handled via a live 
representative within our Customer Service Center.”); PX 3 (Minnucci Rpt) ¶¶23, 26, 47; 
PX 16 (Golden) 99:11-100:1; 100:2-9; PX 151 at -172243; PX 145 (Rog 34 Resp.). 
97. When EDD cardholders called the Bank’s customer service number, they first 
navigated an IVR system (i.e., a pre-recorded menu of options) and then waited on hold 
for the Main Call Center. If the Main Call Center agent determined that the call was 
regarding an unauthorized transaction or unauthorized transaction claim, the agent would 
again place the caller on hold and transfer them to the Bank’s Claims Call Center. All EDD 
cardholder calls seeking to submit a claim regarding an unauthorized transaction, to 
request reconsideration of a CFF-denied claim, or to inquire about the status of a pending 
claim were routed to the Claims Call Center. 
PX 3 (Minnucci Rpt) ¶¶22-26; PX 24 (Ehresman) 21:8-20; PX 16 (Golden) 32:5-21, 
100:16-21, 168:5-17; PX 145 at 14-15 (Rog 34 Resp). 
98. In late summer 2020, the Bank implemented a policy of intentionally understaffing its 
Claims Call center, thereby increasing wait times and creating “
” in the Claims Call 
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Center, making it more difficult for EDD cardholders to submit claims of unauthorized 
transactions, as a strategy “
”  
PX 152 at -118438 (
 
”); PX 153 at -106093-94 (
 
 
 
”); 
PX 154 at-876475; PX 24 (Ehresman) 50:5-13, 54:1-15, 62:21-63:3. 
99. The Bank’s deliberate understaffing policy in late summer 2020 is reflected in its 
. In response to the surge in call volume in Spring 2020, the Bank 
increased the number of CSRs until it 
 
 
 
 
 
 Rather than maintain an adequate staffing level in its Claims Call Center, the 
Bank then sharply reversed course and d
 
 as of September 27, 2020. 
PX 3 (Minnucci Rpt) ¶¶52-54, 58-81, 84, Tbls. 5 & 6, Fig. 3, Appx. F; PX 152 at –118438; 
PX 153 at -106094; PX 16 (Golden) 75:14-76:2; 85:25-87:2; 124:11-125:1; PX 156 at -
719115; PX 286. 
100. 
 its Claims Call Center staffing policies did not distinguish 
between deterring calls from legitimate and illegitimate claimants, and that “
 
 
,” but it implemented its strategy of intentionally 
“
” anyway.  
PX 16 (Golden) 85:25-87:2; PX 24 (Ehresman) 24:7-13, 58:23-60:17; PX 152 at -118438. 
101. The Bank assumed that legitimate EDD Cardholders would tolerate long wait times, 
reasoning EDD “
” 
PX 152 at -118438 (“
 
”). 
102. Deliberately subjecting customers to intentionally prolonged wait times is contrary to 
industry standards and “unheard of in the call center industry.”  
PX 3 (Minnucci Rpt) ¶¶75-76. 
103. When the Bank implemented its CFF on September 28, 2020, the Bank knew that its 
Claims Call Center was already understaffed and that wait times were already 
extraordinarily elevated. 
 implementing its CFF policies would 
cause a surge in call volume from cardholders impacted by the CFF. 
PX 16 (Golden) 75:8-22; 124:22-125:1; PX 3 (Minnucci Rpt) ¶72; PX 21 (Ahmad) 103:13-
104:19; 285:5-25, 287:14-288:4. 
104. From the CFF’s implementation until November 21, 2020, EDD cardholders who 
called the Bank seeking to submit a claim, inquire about the status of a claim, or request 
reconsideration of a CFF-denied claim were required to wait on hold approximately 
 
 simply to speak with an agent in the Claims Call Center, with average 
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wait times peaking in late October 2020 at 
, compared to an industry 
average ASA in 2020 of 1.25 minutes.  
PX 3 (Minnucci Rpt) ¶¶36, 39-40, 52-54, Appx. E; PX 156 at -719115; PX 288. 
105. As a result of these extraordinarily long wait times, the average call abandonment rate 
(i.e., the percentage of callers who hang up or are disconnected before their call is 
answered) in the Bank’s Claims Call Center from September 13 to November 21, 2020 
was 
, compared to an industry average of 6.1%. 
PX 3 (Minnucci Rpt) ¶¶14, 36, 39-40, 53, Fig. 2; PX 156 at -719115. 
106. Understaffing was the root cause of the extreme performance failures of the Bank’s 
Claims Call Center in the Fall of 2020, which fell far below industry standards. 
PX 3 (Minnucci Rpt) ¶¶58, 91-99. 
107. Although the Bank had highly accurate and reliable forecasting based on the 
unemployment insurance daily average, and although onboarding a new call center staff 
person required at least 
, the Bank 
 
. 
PX 3 (Minnucci Rpt) ¶¶46, 60-67; PX 297 at -60339 (“
); PX 16 (Golden) 
66:8-68:6, 69:5-20; PX 28 (Moynihan) 160:11-20; PX 160 at -13097, section 3.5; PX 158 
at -90040, section 3.4; PX 159 at -13086, section 3.4; PX 160 at -13097, section 3.5. 
108. The Bank’s Claims Call Center staffing policies were directed by Paul Simpson and 
Faiz Ahmad, who were delegated authority over those policy decisions, and were 
authorized and/or ratified by then-COO Thomas Montag, 
 
. Montag testified that 
 
 
 
 
 
 
 
.  
PX 26 (Simpson) 9:12-11:5; PX 24 (Ehresman) 21:22-22:2; PX 27 (Montag) 21:21-25, 
22:8-16, 59:2-16, 60:3-23; PX 157  at -881851; PX 28 (Moynihan) 41:6-24.  
K. THE BANK DELIBERATELY DELAYED ISSUANCE OF EMV CHIP CARDS 
FOR SELF-INTERESTED FINANCIAL REASONS 
109. The Bank issued all EDD cardholders cards containing only a magnetic stripe and no 
EMV chip (“mag-stripe-only cards”), even though the Bank had included EMV chips on 
its other consumer and business account customers’ debit cards since 2014. The Bank did 
not issue EDD debit cards with EMV chips until July 2021. 
PX 14 (Martin) 61:19-23, 64:7-13, 65:4-66:3; PX 161; PX 2 (Cloninger Rpt) ¶52; PX 18 
(Johnson) 53:20-54:20; PX 15 (Letson) 161:7-162:3, 162:14-15. 
110. Because mag-stripe-only cards contain cardholder information on the unencrypted 
magnetic stripe and have no other security mechanism to complete transactions, they are 
easy for criminals to steal and counterfeit. For decades, criminals have stolen magstripe 
card data through “skimming,” which involves installing inconspicuous “skimming” 
devices on payment terminals, typically in conjunction with the installation of a device to 
capture entry of PIN numbers, such as a pinhole camera or PIN pad overlay. EMV-chip 
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cards, which require a fully encrypted, dynamic code specific to each transaction, cannot 
be counterfeited and are extremely effective at preventing card-present counterfeit fraud. 
PX 2 (Cloninger Rpt) ¶¶18-25 (citing FBI Overview of ATM Skimming report), 26-35, 
58-75; PX 31 (Joseph) 94:5-9; PX 162 at -455617 (“
 
[.]”); PX 163 at -205594 
(“
).”); PX 14 (Martin 
Dep) 65:21-66:3; PX 10 (Loebner Reb Rpt) ¶¶27-30; PX 164 at -370154 (“
 
”); PX 165 at -463207 
(“
 
”); PX 166 at -228914 (“
 
”); PX 167PX 168 at -
5007 (“
 
”); PX 170 at 
-170413, 170416 (
 
 
 
t”); PX 
171 at 167019-24 (“[
 
); PX 172 at -401309; PX 161; PX 20 (Garfield) 384:1-385:6, 
385:19-386:6, 386:11-15; PX 173 at -123235 (
 
 
); PX 174 at -154043 (“
 
”); PX 175 at -166345 (“
 
); PX 176 at -EDD2375 (“
 
 
); PX 167 at -495785 (“
 
”); PX 177 at -104749; PX 178 at -
163307 (“
 
.”); PX 179 at -417363 (“
 
 
”); PX 166; PX 180; PX 177 at -104749; PX 21 (Ahmad) 
50:22-51:15, 79:9-16; PX 23 (Holt) 280:20-283; Exec. Order No. 13681, 79 F.R. 63491 
(Oct. 23, 2014).  
111. EMV chips have been the industry standard for card security since at least 2019. 
PX 2 (Cloninger Rpt) ¶¶42-45, 46-55; PX 11 (Cloninger Reb Rpt) ¶¶8-45; PX 15 (Letson) 
161:7-162:3, 162:14-25; PX 172 at -401309; PX 171 at -167021. 
112. By 2020, even before the pandemic, the Bank was aware that 
 
 
 
PX 2 (Cloninger Rpt) ¶¶61-62, 85, 87; PX 164 at -370154; PX 181 at -351839; PX 182 at 
-116001; PX 171 at -167022 (
 
 
”); PX 173 at 
-123235 (“
 
”); PX 183 at -406995 (
 
). 
113. In early January 2020, the Bank’s 
 
, that 
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. Once the pandemic began and the 
number of EDD cards and their load value grew, the Bank’s 
 
 because fraud would foreseeably 
increase as a result of those changes. 
PX 14 (Martin) 81:7-83:13, 84:16-85:6, 86:9-24; PX 184 at -104744; PX 181 at -351839; 
PX 2 (Cloninger Rpt) ¶¶60-64, PX 2 Rpt)76; PX 11 (Cloninger Reb Rpt) ¶¶65-67; PX 31 
(Joseph) 149:21-150:8; PX 177 at -104749 (“
 
 
.”). 
114. The Bank promised EDD to (i) be “at the forefront of fraud and data security 
strategies”; (ii) provide “immediate response to emerging fraud trends” and “industry best-
in-class” fraud investigation; and (iii) “employ the highest level of security and fraud 
safeguards” with “multiple layers of extensive security” to “provide significant risk 
reduction associated with misuse of stolen [cardholder] information.”  
PX 13 (Chestnut) 80:14-25, 85:12-86:9, 86:18-87:4, 87:11-20; DX 39 at -2761; PX 33 at 
252-254; see RSUF 10. 
115. The Bank did not offer to issue EMV chip cards before January 2021. The Bank’s 
strategy was to 
 
 
.  
PX 29 (EDD) 40:19-42:3; PX 20 (Garfield) 392:18-394:20; PX 171 at -167023 (
 
”); PX 185 at 
-124142 (“
 
.”); PX 186 at -352396 (“
 
.”); PX 164 at -370154 (“
 
 
”); PX 269 at -698454–55; PX 287; PX 187 at -357755; 
PX 188 at -353034 (“
 
 
; PX 189 at -678774; PX 173 at -123235 (“
 
 
; PX 2 (Cloninger Rpt) ¶¶68-74; PX 181 at -351839-40; PX 182 at -
116001; see RSUF 11, 15, 236. 
116. The Bank 
 
 
 
. 
PX 173 at -123235 (
 
”); PX 
171 at -167019-24; PX 20 (Garfield) 390:9-391:23 (“
 
.”); cf. PX 161. 
117. During the pandemic, mag-stripe-only EDD cards presented “
 
” in California. The Bank saw 
 
 
 resulted from low-security mag-stripe-only EDD debit cards. 
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PX 180 at -297295; PX 175 at -166345; PX 162 at -455617; PX 169 at -82602 (“
 
 
.”); PX 166 at -228914 (“
 
”); PX 165 at -463207 (
 
); PX 190 at -166417 (“
 
”); PX 191 at -297351 (“
 
 
”); PX 192 at -82642 (
 
); PX 193 at -431012 (
 
”); PX 167 at -495785 ; PX 2 (Cloninger Rpt) 
¶¶14(g), 96-102; PX 194 at -218256 (
 
 
; PX 195 at -166408 (“
 
 
”). 
118. EMV would have prevented most, if not all, of the card-present fraud that EDD 
cardholders reported to the Bank. Had the Bank converted to EMV, any counterfeit fraud 
would have been extremely limited due to 
 
PX 162 at -455617 (“
 
”); PX 185 at -124142 (“
 
”); PX 178 at -163307 (“
 
 
  
 
 
 
”); PX 2 (Cloninger Rpt) 
¶¶14(j), 82-88, 103-113; PX 198 at -171973; PX 199 at -570314; PX 190 at -166417 
(
 
 
.”); PX 180 at -297295 (“
 
”); PX 166 at -228914 (
 
 
); PX 193 at -431012 
(
 
”); PX 136 at -57505 (
 
 
 
); PX 11 
(Cloninger Reb Rpt) ¶89; PX 14 (Martin) 112:1-113:25. 
119. When the Bank proposed to EDD that they amend their contract to allow the Bank to 
migrate EDD cards to EMV technology in 2021, EDD responded that it “
 
– 
 
” 
PX 29 (EDD) 38:3-39:10; 39:12-40:17; 61:9-62:17; PX 201 at –59312. 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
JOSEPH W. COTCHETT
By:
/s/ Brian Danitz
COTCHETT, PITRE & McCARTHY, LLP
Respectfully submitted,
Dated: January 9, 2026
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Plfs’ Additional Statement of Facts 
Case No. 3:21-md-02992-GPC-MSB 
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BRIAN DANITZ  
KARIN B. SWOPE  
BLAIR V. KITTLE 
VASTI S. MONTIEL 
CAROLINE A. YUEN 
 
 
Dated:  January 9, 2026  
ALTSHULER BERZON LLP 
 
By:  /s/ Michael Rubin  
 
 
 
 
 
 
 
  
 
MICHAEL RUBIN  
STACEY M. LEYTON  
CONNIE K. CHAN 
 
 
 
 
 
 
JAMES BALTZER 
 
 
 
 
 
 
KATHERINE BASS 
 
 
Co-Lead Counsel for Plaintiffs and  
the Class   
 
 
Case 3:21-md-02992-GPC-MSB     Document 652-2     Filed 02/03/26     PageID.55603 
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Plfs’ Additional Statement of Facts 
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SIGNATURE ATTESTATION 
Pursuant to section 2(f)(4) of the Electronic Case Filing Administrative Policies and 
Procedures Manual, I, Brian Danitz, attest that the other signatories listed, and on whose 
behalf this filing is submitted, concur in the filing content and have authorized this filing. 
 
Dated: January 9, 2026  
 
 
/s/ Brian Danitz 
 
 
BRIAN DANITZ 
Case 3:21-md-02992-GPC-MSB     Document 652-2     Filed 02/03/26     PageID.55604 
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