CA AB274

Amends Section 1339.1 of the Unemployment Insurance Code to require unemployment compensation benefit prepaid cards to be chip-enabled.

Defines "chip-enabled card" as a card containing a microchip with memory capabilities and embedded secure integrated circuits for authentication purposes.

Prohibits persons or entities that issue prepaid cards from accepting or facilitating direct deposit of unemployment compensation benefits if the card does not comply with the chip-enabled requirement.

Clarifies that the Employment Development Department has no obligation to verify whether a recipient's chosen account is compliant and is not liable for deposits to non-compliant prepaid card accounts.

Takes effect immediately as an urgency statute to prevent fraudulent unemployment insurance claims during the COVID-19 pandemic.