As our agencies work together to combat underground economic activity in California, we will provide webpage links when articles are published or news stories are released.
- The EDD actively prosecutes fraud and has created a web page which lists the most recent convictions for fraud
- 22 Unlicensed Contractors Cited by CSLB in Ventura County (California Department of Consumer Affairs, Press Release March 6, 2019)
- CSLB Cites Two Dozen for Illegal Contracting in Lafayette (California Department of Consumer Affairs, Press Release February 20, 2019)
- U.S. Department of Labor Recovered $1.5 Million in Back Wages and Damages for Southern California Garment Industry Employees This Year (United States Department of Labor – Wage and Hour Division, News Release December 6, 2018)
- U.S. Department of Labor Investigation Results in Los Angeles Garment Maker Paying $51,840 to 40 Employees to Resolve Wage Violations (United States Department of Labor – Wage and Hour Division, News Release August 28, 2018)
- San Jose based security company busted for $3.2 million premium fraud (California Department of Insurance, Press Release May 10, 2018)
- Contra Costa Restaurants Cited for Failing to Provide Workers’ Compensation Insurance (PDF) (Office of the District Attorney Contra Costa County, Press Release July 24, 2018)
- Thriving underground economy targeted in statewide multi-agency outreach and enforcement effort (California Department of Insurance, Press Release May 19, 2016)
Articles and Reports on the Underground Economy
The underground economy presents a major problem for businesses and workers alike. Businesses properly complying with laws and regulations face higher operating costs than those who cut corners on taxes, labor, wage and safety laws, and licensing and insurance requirements. Workers who become employed with these underground businesses suffer greatly. They do not receive benefits such as Unemployment Insurance or Disability Insurance. Their income is not reported, so they and their families will not be eligible for Social Security credits.
Below are some published reports that provide detailed information on the underground economy and how it affects everyone.
- Little Hoover Commission Report on the Underground Economy (PDF)
- Economic Roundtable: “Hopeful Workers, Marginal Jobs: LA’s Off-The-Books Labor Force”
- Efforts to Address California’s Tax Gap (PDF)
- Frequently Asked Questions About the Tax Gap (PDF)
- Tax Gap Plan: A Strategic Approach To Reducing California’s Tax Gap (PDF)
- California Tax Gap Strategies (PDF)
- Tax Gap Estimates for Tax Years 2008-2010 – April 2016 (PDF)