In 2016, after Michigan’s unemployment office implemented an online portal for those seeking benefits, scammers started flooding the system, flooding it with fraudulent claims, according to a Department of Justice civil forfeiture complaint filed in December and unsealed Monday. “To facilitate the scheme, many public sector employees had been secretly stationed at the Michigan Unemployment Insurance Agency (UI Agency) to accept, process, examine, approve and send the fraudulent claims to the Department of Treasury,” according to the complaint.
Through the bureau of recovery, a government investigative arm, the government and other entities were able to ensnare and arrest many alleged scammers, most of whom worked at the agency under contract with the Treasury Department. The full attorney-client confidentiality agreement for a person named in the complaint—and who is a subject of the investigation—apparently remains sealed for the time being. But we do know that some of them have already pleaded guilty to making fraudulent payments and money laundering.
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