Concealment in Michigan

A heartrending story about how concealment has gone off the rails and ensnared countless innocent claimants is recently posted in the Detroit MetroTimes.

The story describes how computerized claims handling is automatically finding claimant fraud based on protocols that do not reflect actual real-world events and how web-based communications (in place of regular mail) to notify claimants of the fraud accusations have made fighting these false accusations ever more difficult. Because the claimants are NOT checking their web portals when no longer filing for unemployment benefits and the fraud accusations arrive months or even a year after the alleged fraud took place, claimants are missing the fraud notice and so miss the deadlines for challenging the accusations. The result: folks are having their lives upended, are filing for bankruptcy, and tragically committing suicide.

A federal civil rights complaint over these practices was filed in April of this year. For too many, however, the damage has been done.

Rick McHugh, staff attorney with NELP, had the following to say about this issue:

Over recent years, NELP has pointed out that state agency barriers related to technology now serve as barriers to UI benefit access; perhaps exceeding the impact of legislation and legal measures in some cases. In the fall of 2013, Michigan implemented a new software package for UI benefits that included fraud detection software. This has resulted in many problems in the administration of UI benefits, including an explosion in accusations of fraud. These determinations are made solely by computer and are widely known in Michigan as robo-fraud.

Metro Times, a Detroit-based publication roughly equivalent to the Chicago Reader or Bay Guardian, has just published an expose that covers many aspects of Michigan robo-fraud. Literally tens of thousands of individuals have been accused of fraud without any evidence of intentional misrepresentation. While these are frequently reversed, many folks fail to appeal and many resolve never to file for UI again. For this reason, Metro Times refers in its title to the criminalization of UI, and I fear that is not an exaggeration.

A host of advocates including Michigan UI Project, Sugar Law Center, the UAW and a private attorney have joined together in a federal lawsuit and media is finally focusing sympathetic attention on the problem. NELP has asked the U.S. Department of Labor to intervene. Local advocates are approaching members of Congress.

The morals of this story are 1) technology can be a tool for customer convenience, but also a barrier to just administration of UI programs, 2) simply monitoring formal rulemaking and legislative forums for UI developments can result in private decision making within agencies that have wide, negative impacts, and 3) claims of fraud and improper payments have been turned into weapons against UI and we must develop a better narrative to contend with these attacks.

6 thoughts on “Concealment in Michigan

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