Facing delays, many unemployed Oklahomans opt to pay debit card company for ‘expedited’ delivery

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A notice on OESC’s website directing people who are having issues with the debit cards for unemployment funds to call Conduent for support. Courtesy/OESC
As thousands of Oklahomans who were laid off or furloughed because of the COVID-19 crisis continue to wait weeks to receive a mailed debit card loaded with their unemployment benefits, the company responsible for distributing those cards is expediting delivery of some — for a fee.

Numerous Oklahomans who have filed for unemployment have reported waiting weeks for the company that prints and services the state’s unemployment cards, Conduent, to send their benefits card once their unemployment claims are approved by the Oklahoma Employment Security Commission. After calling the card company, several people have reported that the company offered an expedited delivery of their card within three days for a $15 fee.

Conduent, a publicly traded company and offshoot of Xerox Corp., offers numerous services in a wide variety of sectors — transportation, health care, insurance and other sectors. One section of the company contracts with federal, state and local governments, and manages more than 100 pre-paid debit card programs across 34 states. It operates 29 electronic benefit transfer programs such as the food stamp program, the Women, Infants and Children program and unemployment insurance programs.

Conduent’s current contract with the state began in January 2017, when the company was still part of the Xerox Corp., and in addition to OESC’s unemployment cards, it produces electronic benefits cards for several state agencies, including the Oklahoma Department of Human Services and the Oklahoma State Treasurer’s Office. Under that contract, Conduent may collect fees from card holders, including fees for out-of-network ATM usage, some balance check phone calls and the $15 fee for expedited card replacement.

It is not clear how many Oklahomans have opted  to pay the $15 expedited card fee or how much in fees Conduent has collected since the pandemic began, as OESC does not collect data on how much Conduent collects in fees, an agency spokesman told The Frontier.

Once a person who has applied to OESC is approved for unemployment payments, the person’s information is sent to Conduent, which generates a card to access the unemployment funds. OESC has directed people who are having issues with the debit card to call Conduent to sort out any issues.

Those who choose to pay the $15 fee for expedited delivery will find the money deducted from the card’s balance once it arrives, usually within three days of ordering it, said Sally Cannon, who said she received a card early on but whose son had difficulty getting one.

“I was one that received a regular card but my son had to wait for his. Then suddenly, the unemployment numbers drastically increased as the virus got worse and the cards started taking longer to show up, if at all,” Cannon said. “Now, there are literally thousands of people filing for unemployment and the only way they are getting the cards, are if they agree to pay the $15 fee to have it expedited. And conveniently, they deduct it from your account before they send the card.”

Trey Davis, spokesman for OESC, said OESC was told by Conduent that the non-expedited cards are facing delays of between 16 and 18 days because the non-expedited cards are mailed out via the U.S. Postal Service, while the expedited cards are sent via UPS.

According to the U.S. Postal Service, it is experiencing only minor operational impacts in the United States as a result of COVID-19, with the exceptions of mail to or from China or Hong Kong.

Derek Wilburn, who was laid off from Oklahoma City’s Red River Digital on April 1, said he didn’t have many problems with the OESC online application system, but weeks after submitting his application and information, his status was listed as “pending.” After making numerous calls to OESC, his status was eventually changed to “paid,” he said. He was notified on April 21 that a “replacement” debit card with his unemployment funds on it would be sent to him in several days.

He again waited for weeks to receive the card in the mail. After calling Conduent and waiting for more than five hours on hold, he said he was told he could pay a $15 fee to have the card expedited and sent to him within three days.

Already overdrawn in his bank account, Wilburn said he told the company no. Wilburn said he was ineligible for food stamps since he was technically receiving $1,000 per week in unemployment, though he could not access that money.

Several other people on the Unemployed in Oklahoma Facebook group also reported delays, double charges and other issues in receiving cards, and numerous group members reported paying the $15 fee after waiting weeks for a card and receiving the card within three days after making the payment.

Wilburn, who reported receiving his card on Friday after speaking to The Frontier, said he saw the experiences of others in the group and said Conduent “is purposefully exploiting the poor and desperate.”

“Honestly, if the state could just deposit the funds directly instead of using a third-party middleman, the problem wouldn’t even exist,” Wilburn said. “Not sure how as Oklahoma taxpayers we have all sorts of identifiable data points, but they force us to go through a third party. I am to the point of selling personal items.”

The Way2Go Card, part of Conduent’s debit card program for payments from local, state and federal governments. Courtesy/CONDUENT

Conduent did not respond to specific questions from The Frontier about the cards and fees, issuing only the following statement:

“We are working closely with the State of Oklahoma to fulfill the unprecedented increase in disbursement of unemployment benefits. As indicated, a number of entities are involved in working as quickly as possible to get cards into the hands of hundreds of thousands of Oklahomans in need. We continue to deliver our portion of the fulfillment as rapidly as possible, and we are working cooperatively with the State and other vendors to make sure that Oklahomans get their benefits as quickly as possible.”

However, during Conduent’s first quarter earnings conference call on Thursday evening, Conduent CEO Cliff Skelton told investors that the company was facing significant downturns in some of its businesses because of COVID-19. And while its $1.1 billion in revenue for the first quarter of 2020 is lower than revenue from the previous year, some of the negative impacts the pandemic was having on other parts of its business were being offset by revenue increases in its government services division

“On the government side, we’re starting to see significant increases in several of the services we provide to our government clients,” Skelton told investors. “Our payments activity for Supplemental Nutrition Assistance Program (SNAP), Women Infants and Children (WIC) and especially unemployment benefits are showing significant volume increases.”

In addition to increased volume from food stamp cards issued, the company was seeing “significant upswing” in the number of unemployment benefits cards being issued in the 11 states it provides the service for, Skelton said.

“This activity tends to increase in times of lower economic activity and we are seeing the benefits from a few of these offerings,” Skelton said.

“While no one would choose to have such a crisis to respond to, we see a silver lining with a blue bird here and there, and our intention is to execute our plan to take advantage of the opportunities where they surface and minimize the downside wherever possible,” Skelton said at the closing of his prepared remarks.

Davis said OESC decided to use Conduent’s card system because several other agencies were already using it and, though it is now possible to have funds direct deposited through Conduent, the state may consider other options going forward.

“DHS and perhaps another agency already had a contract in place with Conduent and it was a business decision to pay (unemployment) claims in that manner as opposed to obtaining a claimants personal banking information,” Davis said. “Multiple states implemented the same system. As the state migrates more agencies to its digital transformation platform, the agency may look at other payment options previously unavailable when this contract was established.”

Update May 12, 2020, 1:10 p.m.: Conduent released the following statement to The Frontier: “We continue to work rapidly with the State of Oklahoma to fulfill the unprecedented increase in disbursement of unemployment benefits. There is no charge for beneficiaries to receive a new card or a replacement card through the U.S. Postal Service. We are offering the expedited service as an option for those who choose to take advantage of it, which covers the incremental cost of expediting via a third-party delivery service. Furthermore, if beneficiaries have never received unemployment benefits and are recently eligible, they can set up direct deposit for free if they have not yet received a card.”

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Clifton Adcock

Senior Staff Writer

A veteran investigative reporter who has covered eastern Oklahoma for more than 15 years, Clifton joined The Frontier in April 2017. A native of southeastern Oklahoma, he has covered numerous issues from criminal justice to politics for publications including the Tulsa World, the Oklahoma Gazette, and Oklahoma Watch. Clifton holds a master’s degree in journalism from the University of Oklahoma. Clifton can be reached at clifton@readfrontier.com. Follow him on Twitter @cliftonhowze
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