LANSING, Mich. — Liza Estlund Olson underwent extensive questioning Wednesday morning at the State Capitol about the fraud found within the Unemployment Insurance Agency. She recently took the position of director after a report revealed that Michigan may have paid out $1.5 billion in unemployment fraud claims.
“When Governor Whitmer asked me to take on the acting UIA director position I was happy to help during this critical time,” Olson said during her opening statement to the Joint Select Committee on the COVID-19 Pandemic via Zoom. “A time when our workers need emergency financial assistance to put food on the table and provide for their families and we all continue to battle the public health crisis that is COVID 19.”
Deloitte, a consulting and accounting firm, conducted the report and found widespread fraud under former director Steve Gray, who resigned in early November. Some of the fraud included rings and phishing scams stemming from overseas.
“Our goal is to get 100 percent of eligible claimants, 100 percent of their benefits and quickly answer every phone call,” Olson said. “To get there and stay there, we have and will continue to make improvements throughout the agency.”
Rep. Tyrone Carter (D-Detroit) mentioned recently discovering a scheme in the U.S. in which 26 families were using one address, showing American fraudulence and greed.
“We do have any number of addresses that get flagged in the system,” Olson said. “We had one that had 102 claims attached to a two-bedroom house in the middle of a cornfield. We somehow don’t think there were 100 people living in that two bedroom house. We find those and we flag those addresses in the system.”
Olson said many things are flagged in the system. However she believes one of the best ways to move forward is by helping the unemployed now by extending their unemployment benefits from 20 to 26 weeks.
Rep. Matt Hall (R-Battle Creek) asked why that was her focus.
“Well it’s the focus because if we have a continuation of the pandemic, which we will and people continue to not be able to have jobs, they need to know that they can have 26 weeks of unemployment,” Olson said. “And, at $362, just with the rate of inflation that has not kept up with anything, the price of everything has gone up in the last 20 years.”
Rep. Hall said that and he the committee have been asking about fraud for months largely because they have constituents who have filed claims and haven’t heard anything back from the UIA.
Sen. Aric Nesbitt echoed the same sentiment.
“A lot of these people are unemployed through no fault of their own. Some of them have never been unemployed before because they’re small business owners who were forced to shutdown this spring and they’ve been trying to collect it themselves,” said Sen. Nesbitt (R-Lawton) . “I know for a fact that they’re not foreign agents because I run into them at the grocery store and they ask me ’any update on my unemployment, I just got shut down again two weeks ago.’”
Sen. Nesbitt was concerned about the legitimate claims and when their phone calls and questions will be answered.
“We’ve more than quintupled customers-facing staff. Before the pandemic, UIA had only 650 staff in total. Now nearly 3,000 UIA team members are helping claimants,” Olson said. “This includes answering phones through the call center, making proactive calls, requesting information, answering questions online, solving technical issues and adjudicating claims.”
She also mentioned that they created a phone system for claims that need immediate individual attention. Since they launched it in late October, 18,000 people have been helped.
Rep. Hall also asked about employees raising concerns about the potential for increased fraudulent activity after the head of the investigations unit was moved to do special projects.
“I even read where it appeared that some of those employees went to the top brass and voiced some concerned and they might not have been heard,” said Rep. Jack O’Malley (R-Lake Ann). “So to anybody from UIA who’s listening, I guess I’d like to say on behalf of this committee, that’s why we’re asking these questions because we understand from that report that some of your concerns weren’t heard. So, please know that we’re here with you.”
Olson reiterated that she wasn’t with the UIA at the time but said that in hindsight the head of the investigations should have remained with the unit and not have moved.
She added that ”we can sprinkle blame dust everywhere and that doesn’t help us pay the claimants now.” So, she’s focused on moving forward.
“As I enter my 14th day in this position, I’ve seen a UIA team full of exceptional state employees who are working around the clock, including mandatory overtime, to serve the people of Michigan and provide this economic lifeline to workers whose jobs have been affected by the pandemic,” Olson said. “They wake up everyday knowing their efforts are critical to the well-being of thousands of workers and their families.”