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Lansing — The Michigan Talent Investment Agency is asking district court judges to dismiss 186 bench warrants issued against residents who were accused of unemployment fraud and failed to appear in court to face charges.

Director Wanda Stokes said Thursday it is inappropriate to pursue charges against the individuals at this time while the state continues to review past fraud determinations made by an error-prone automated computer system, many of which have already been overturned.

The arrest warrants in question were issued in Wayne, Genesee and Macomb counties, according to the state, which is asking judges to cancel them.

“This is done out of an abundance of caution and in the interest of justice,” Stokes said in a statement. “We have requested that this action occur on an emergency basis to avoid harm to state residents and that the warrants be dismissed without prejudice.”

The agency has acknowledged widespread problems with an automated computer system used to determine fraud and so far reversed more than more than 27,800 determinations from between October 2013 and August 2015. The state is expected to complete its review of additional cases by the end of July.

Some accused residents did not even know they had been ordered to appear in court, said attorney Jennifer Lord, who is representing alleged victims in a potential-class action lawsuit against the agency.

Lord suggested the state had “farmed out” the prosecution of cases in Flint and Detroit and pursued charges months or even years after learning of problems with the computer system.

“The fact they are just now doing it, and claiming they deserve some sort of pat on the back, is absolutely outrageous,” she said.

Lord questioned how many residents may have already pleaded guilty to false fraud charges, agreeing to give back alleged overpayments to avoid steep penalties and interest.

“It’s just another example of how this is rotten from top to bottom, and the state has ignored it,” Lord said. “The elements of harm that have impacted people are so wide and varied.”

Asked if anyone had already pleaded guilty to avoid larger penalties, state spokesman Dave Murray said the unemployment agency is “focused on the open bench warrant cases and making sure people are treated fairly.”

“It would be inappropriate to answer a hypothetical question,” Murray said. He was not immediately aware of any instances where someone had pleaded guilty to alleged fraud the agency later determined he or she did not commit.

A Michigan Court of Appeals panel on Tuesday ruled the potential class-action lawsuit against the state should be dismissed because named plaintiffs had not filed within six months “following the happening of the event giving rise to the cause of action,” as required in suits seeking financial damages against the state.

Plaintiffs intend to appeal to the Michigan Supreme Court. The suit contends the Unemployment Insurance Agency violated the constitutional due process rights of those and other claimants by seizing their property without proper notice. The appeals court ruled the harm occurred when the state sent notices, not when the property was seized.

Stokes agreed with the Court of Appeals’ dismissal ruling but said it did not change the agency’s focus on reviewing additional cases and improving customer service.

“We continue to work tirelessly to restore the public’s trust in our Unemployment Insurance System, and we are undertaking a comprehensive review of everything we do to make sure residents are getting the best possible service,” Stokes said Thursday.

“During this review period, it is important that we work with the courts and ask that some bench warrants for people issued in relation to unemployment fraud cases be dismissed.”

Once the underlying charges are dismissed, the agency plans to review each case file. If staff confirms that a resident should be charged with unemployment insurance fraud, the agency said it is required by law to work with prosecutors to issue a new complaint and warrant.

Stokes said the agency will attempt to contact any one affected by a court action and said residents with additional questions can contact a state hotline at (855) 842-7463.

joosting@detroitnews.com

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