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Mich. taps new UIA head to‘restore public trust’

Jonathan Oosting
Detroit News Lansing Bureau

Lansing — Michigan is bringing in new help to overhaul and rebuild confidence in the state Unemployment Insurance Agency that has acknowledged wrongly accusing tens of thousands of out-of-work residents of fraud.

Michelle Beebe, who has worked with the Utah Unemployment Insurance Division since 2008 and led it since December 2014, has been tapped as the next director for the Michigan agency. She is scheduled to start May 8.

Talent and Investment Agency Director Wanda Stokes announced the hire Tuesday, roughly three months after reassigning former director Sharon Moffett-Massey and launching a national search for her replacement.

“Michelle Beebe has the experience and leadership we need as we restructure Michigan’s Unemployment Insurance Agency and restore the public’s trust after our recent challenges,” Stokes said in a statement.

“I know that she is willing to create an environment that is completely focused on helping people get the benefits they need as they transition to new careers.”

The Michigan agency has been under fire for its use and handling of an automated computer system that made more than 20,000 false fraud determinations between October 2013 and August 2015. A separate software update system glitch earlier this year potentially allowed unauthorized access to information for nearly 1.9 million residents.

The unemployment agency has so far reversed computer-based fraud determinations in 20,965 of 22,427 cases made during a nearly two-year period when it did not require human review in many instances. It is continuing to review additional cases.

In January, Stokes announced a three-point plan to address agency “challenges,” and the state agreed to a series of broad policy reforms in February as it settled a federal lawsuit filed on behalf of residents falsely accused of unemployment fraud.

The settlement required the agency to change the way it handles fraud cases but did not award monetary damages to plaintiffs, beyond mandatory refunds of fines and penalties levied for false fraud determinations. A separate class-action suit seeking additional financial compensation remains active in state court.

Stokes on Tuesday praised Beebe’s work in Utah and said she has a national reputation for best practices in unemployment insurance. Beebe testified before the U.S. House Ways and Means Committee in September, describing successes in Utah and challenges facing other states, according to the Utah Department of Workforce Services.

“Utah is a positive example of how the unemployment system protects both employees and employers,” Beebe said in a statement released by the Michigan Talent and Investment Agency, which oversees the unemployment agency.

“I know about some of the challenges Michigan is facing, and there is more that we need to do. I know there is a staff that is dedicated to helping people in the state. Together, we’ll continue to make improvements and the Michigan agency will be one of the best in the nation.”

Stokes personally apologized for the unemployment agency’s woes in a January interview with The Detroit News, vowing to fix the automated computer system and calling on legislators to review “harsh” penalties that ensnared victims.

As The News reported, Michigan’s 400 percent penalty for unemployment insurance fraud is believed to be the steepest in the nation. It compounds the financial burden for out-of-work residents who were falsely accused by the state’s automated computer system.