Michigan's unpaid unemployment claims grow to 137,000; many flagged for fraud

Craig Mauger
The Detroit News

Lansing — The number of Michigan residents who have filed claims for unemployment but haven't received payments has grown, but the state says the vast majority of the unresolved claims have been flagged as "potentially fraudulent."

The Michigan Unemployment Insurance Agency, which has faced unprecedented filings during an economic shutdown because of COVID-19, said Friday about 137,000 claimants haven't received any payments.

Nearly a month ago, on May 21, Michigan Department of Labor and Economic Opportunity Director Jeff Donofrio told lawmakers that about 124,000 people had not yet received any payments.

But 100,000 of the current unpaid claimants have been flagged as "potentially fraudulent" amid a wave of impostors filing for unemployment on others' behalves, according to the Unemployment Insurance Agency.

About 37,000 unpaid claimants have been held for "other reasons," according to the agency.

Since March 15 — five days after the state confirmed its first COVID-19 cases — about 2.1 million eligible claimants have applied for state and federal benefits, with $11.4 billion in benefits paid to more than 2 million workers.

But tens of thousands of Michiganians still are waiting for their financial assistance. Some, like Jennifer Bruins of Coopersville, have been waiting for nearly two months.

Bruins, an X-ray technologist who's been on furlough since April 22, said she made a mistake on her initial filing, and she's gone eight weeks without benefits and without getting her situation resolved. 

"I can’t get a hold of anybody," Bruins said of trying to reach the agency. "I tried several days of waking up early and calling 50 to 100 times, and you just get hung up on every time."

"They just need to get more help and fix their system for people with questions," she said.

During a Thursday House committee hearing, lawmakers said they were told that when their staffs submit claims issues to the UIA for a constituent experiencing significant delays, the agency would take an average of two weeks to respond.

But the estimate was later amended to four weeks, Hall said, and some constituent claims submitted by lawmakers have sat untouched for five weeks.

A bipartisan letter of 12 Michigan House members, signed mostly by Democrats, is seeking a limited reopening of the state unemployment offices similar to what was done with Secretary of State branches, which opened for limited appointments starting June 1. Unemployment offices across the state have been closed for in-person transactions since March 18. 

Steve Gray, director of the Unemployment Insurance Agency, has previously apologized for flaws with the state's unemployment website.

Steve Gray

"Our focus remains on getting 100% of eligible Michigan workers 100% of the benefits they deserve," Gray said in a Friday statement. "We are using every available resource to verify the identity of legitimate claimants whose payments are held due to increased criminal activity, including 850 dedicated employees and newly formed advanced analytics team."

A group of 19 Republican House lawmakers and one Democratic legislator previously wrote a letter to Gov. Gretchen Whitmer seeking the ouster of Gray and the UIA's leadership team for the problems. 

Earlier Friday, Rep. Matt Hall, R-Marshall, chairman of the Joint Select Committee on the COVID-19 Pandemic, released information he received Thursday from the Unemployment Insurance Agency that showed 166,133 people had filed claims but hadn't received payments.

"These numbers not only confirm problems still exist, but they show they are getting worse," Hall said in a statement.

"I’m interested to know why this number keeps going up, given that the rate of new claims has slowed and people are getting back to work safely and sensibly," he added. "The agency has had a month to work through some of these issues since they last spoke with our committee."

The agency issued its own press release shortly after Hall's announcement with the updated 137,000 number.

In addition, the Unemployment Insurance Agency announced it has now cleared a majority of the active accounts — those already receiving benefits — caught in the wave of attempted fraud.

The state previously put a hold on 340,000 active accounts. The agency has now "cleared" 200,000 of those accounts, according to a Friday press release.

The agency "continues to work through the remaining 140,000 active accounts to move eligible claimants back into benefits," according to the release.

Detroit News Staff Writer Beth LeBlanc contributed