Michigan's Unemployment System Bilked Poor People Out Of Millions

As if the Flint water crisis wasn't enough, Michigan's unemployment system installed under Governor Rick Snyder flagged a whopping 93 percent of applicants as fraudulent.

And as she points out, even as most of the applicants expected to receive the unemployment benefits they needed, they instead were accused of defrauding the system and required to pay fines. Most were not aware that they could appeal the decision, so they paid the fines instead of receiving unemployment benefits they were entitled to.

As a consequence, the reserve fund for unemployment in Michigan ballooned to $155 million in just three years.

The Guardian reported that the state seized tax refunds and bank accounts to take the funds away from people who were, in fact, not filing fraudulent claims.

According to the report, "The Michigan unemployment insurance agency (UIA) reviewed 22,427 cases in which an automated computer system determined a claimant had committed insurance fraud, after federal officials, including the Michigan congressman Sander Levin, raised concerns with the system."

The results were shocking, showing that "the overwhelming majority of claims over a two-year period between October 2013 and August 2015 were in error."

The point of this automated system was to streamline the process and cut state costs by completely automating the process, rather than subjecting determinations to human review.

What makes this utterly craven, though, is that Michigan Republicans just this week, while knowing full well that refunds and reviews were in order, passed legislation to take $10 million out of the unemployment surplus fund to balance the state budget.

This is a picture of what Republican-controlled government will try to do at a national level now that they have the power to do so. If you're poor and have no resources, they'll go after you to take money that doesn't belong to them, while cutting taxes and poisoning water.

The good news here is that the state of Michigan has paid some people out after the review, but many more are still waiting in line. According to reports, even after reviewing 22,000 erroneous determinations, there are another 30,000 unopened cases which have not yet been examined or resolved.


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Meanwhile, people go bankrupt, hungry, or worse. This is criminal. How could they allow a computer to kick 93 percent of people out of a system intended to be a safety net?

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