In 2014, Carmelita Colvin was living just north of Detroit and taking classes at a local college, when she received a letter from the Michigan Unemployment Insurance Agency. The letter stated that she’d committed unemployment fraud and that she owed over $13,000 in repayment of benefits and fines.
Colvin’s reaction, she recalled, was: “This has got to be impossible. I just don’t believe it.” She’d collected unemployment benefits in 2013 after the cleaning company she worked for let her go, but she’d been eligible. She couldn’t figure out why she was being charged with fraud.
What Colvin didn’t realize at the time was that thousands of others across the state were experiencing the same thing. The agency had introduced a new computer program — the Michigan Integrated Data Automated System, or MiDAS — to not only detect fraud, but to automatically charge people with misrepresentation and demand repayment. While the agency still hasn’t publicly released details about the algorithm, class actions lawsuits allege that the system searched unemployment datasets and used flawed assumptions to flag people for fraud, such as deferring to an employer who said an employee had quit — and was thus ineligible for benefits — when they were really laid off.