Incident 373: Michigan's Unemployment Benefits Algorithm MiDAS Issued False Fraud Claims to Thousands of People

Description: State's use of Michigan Integrated Data Automated System (MiDAS) to adjudicate unemployment benefits claims falsely issued fraud determinations based on un-investigated assumptions, resulting in tens of thousands of false fraud cases over years.


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Khoa Lam
Michigan unemployment agency made 20,000 false fraud accusations · 2016

A Michigan government agency wrongly accused individuals in at least 20,000 cases of fraudulently seeking unemployment payments, according to a review by the state.

The review released this week found that an automated system had erroneousl…

State apologizes for fraud fiasco, wants to reduce penalties · 2017

LANSING, Mich. (AP) — A state official who is conducting a wide-ranging review of Michigan’s embattled unemployment benefits office apologized for the fiasco that led at least 20,000 people to be falsely accused of defrauding a system that …

Michigan may pay victims of unemployment benefits blunder · 2017

LANSING (AP) — Gov. Rick Snyder and lawmakers are looking to create a state fund to compensate thousands of people who were falsely accused of fraudulently collecting unemployment benefits.

The proposal was not included in changes to the Un…

Michigan residents falsely accused of jobless fraud can sue, Supreme Court says · 2019

LANSING – In a ruling that could affect tens of thousands of Michigan residents falsely accused of unemployment insurance fraud, the Michigan Supreme Court on Friday revived a proposed class-action lawsuit that a lower court had dismissed.

Submission to the UN Special Rapporteur on Extreme Poverty & Human Rights Regarding His Thematic Report on Digital Technology, Social Protection & Human Rights · 2019


This submission examines the human rights implications of Artificial Intelligence (AI) and other data-driven technologies in welfare benefits programs, such as cash and food assistance programs. Through a series of case studies, thi…

Government’s Use of Algorithm Serves Up False Fraud Charges · 2020

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…

Judge: Companies can be sued over Michigan unemployment fraud fiasco · 2021

LANSING — Michigan residents falsely accused of unemployment insurance fraud by the state of Michigan — and subjected to harsh financial penalties that forced some of them into bankruptcy — can proceed with their lawsuit against not just st…

Thousands of unemployed in Michigan wrongly accused of fraud can seek cash from state · 2022

Thousands of people who were wrongly accused of fraud when seeking unemployment benefits can seek financial relief from the state, the Michigan Supreme Court ruled Tuesday, breaking new ground when someone claims their constitutional rights…

State Supreme Court says victims of jobless benefits system failure can seek damages · 2022

A 7-year-old lawsuit against the state of Michigan over malfunctions in its unemployment compensation system will continue. A split decision by the Michigan Supreme Court keeps alive the class-action quest for damages that could encompass a…

The Seven-Year Struggle to Hold an Out-of-Control Algorithm to Account · 2022

Hello, friends,

This week, the Biden administration released its Blueprint for an AI Bill of Rights, a wish list of principles that “should guide the design, use, and deployment of automated systems.”

The principles state that Americans sho…

Michigan will settle 2015 unemployment false fraud lawsuit for $20 million · 2022

The state of Michigan has reached a $20-million settlement in a class action lawsuit from unemployment claimants who were wrongly accused of fraud, resulting in the seizure of their property without the right to be heard.

The lawsuit, Bause…

Court OKs $20M settlement in unemployment false fraud suit. What claimants need to do next · 2023

A $20 million settlement in a class-action lawsuit filed by unemployment insurance claimants who were wrongly accused of fraud and then had money and other assets seized has been approved by the Michigan Court of Claims.

Claimants are eligi…


A "variant" is an incident that shares the same causative factors, produces similar harms, and involves the same intelligent systems as a known AI incident. Rather than index variants as entirely separate incidents, we list variations of incidents under the first similar incident submitted to the database. Unlike other submission types to the incident database, variants are not required to have reporting in evidence external to the Incident Database. Learn more from the research paper.