The Building Tradesman Newspaper

Friday, January 20, 2017

Enhanced state reviews take second look at 'false' unemployment claims

By The Building Tradesman

LANSING - The Michigan Unemployment Agency has been finding fraudulent claims where there isn't any fraud.

Late last year the agency, in conjunction with the U.S. Department of Labor, re-reviewed cases where unemployment fraud was originally found. Turns out that a computerized, automated system had flagged 53,633 cases between October 2013 and August 2015 as being fraudulent, with the state reviewing 22,427 of them. Of those, 20,965 were found not to be fraudulent - a 93 percent failure rate.

"While I'm pleased that a small subset of the cases has been reviewed, the state has a responsibility to look at the additional 30,000 fraud determinations made during this same time period," said Congressman Carl Levin (D-Southfield).

The state Unemployment Agency subsequently pledged to review the additional cases marked as fraud. Agency spokesman Dave Murray told MIRS new service that the agency has made some changes, chief among them is that they no longer use an automated system to issue fraud determinations.

"Instead, trained staff investigates, reviews and makes the determination in all fraud cases, which includes the additional step of contacting the claimant and/or employer for additional information if needed," Murray said.

The overturning of those fraud cases resulted in $5.4 million being repaid to individuals, according to Levin's office.

“I am very pleased to hear that the state has committed to reviewing the additional fraud decisions made during the period that there were automatic computer determinations," Levin said Jan. 6. "It is important that the Talent Investment Agency has announced a full review of all cases to ensure that anyone wrongly accused of fraud is made whole and has their record corrected, in addition to the comprehensive improvement measures announced for UIA yesterday."

The state Talent Investment Agency subsequently announced a number of changes for the UIA, including the replacement of the UIA director.

"We are being as thorough as possible in reviewing potential fraud determinations because we want to be fair to people filing claims, but also continue to be vigilant against fraud, which hurts everyone," said Wanda Stokes, director of the Talent Investment Agency.