Former state unemployment worker sentenced for COVID-19 fraud scheme

A former state unemployment examiner has been sentenced to 18 months in prison for her role in a $313,000 pandemic-related unemployment insurance fraud scheme, federal authorities announced Tuesday.

Semaje Reffigee, 26, pleaded guilty in March to conspiracy to commit wire fraud.

The Detroit resident started working as a contract unemployment insurance examiner with the Michigan Unemployment Insurance Agency in October 2020, had electronic access to the database and used her credentials to access and approve specific claims submitted to the agency, investigators found.

Through June 2021, Reffigee "conspired with others to obtain benefits through the submission of false UI claims. Reffigee’s co-conspirators electronically submitted fraudulent claims to MUIA," the U.S. Attorney's Office for the Eastern District of Michigan said in a statement. "Reffigee then abused her position ... to re-activate claims that had previously been flagged for fraud, and ... go outside her assigned workflow to approve fraudulent claims in the first instance."

Reffigee re-activated or approved more than 35 fraudulent claims valued at more than $300,000 and received kickback payments from her co-conspirators, according to the release.

“Corrupt public servants compromise the ability of the government to function effectively and undermine confidence in all public programs," U.S. Attorney Dawn Ison said Tuesday. "Semaje Reffigee – an employee of the state – stole money from a program intended to help our most vulnerable citizens during an unprecedented national crisis. This prosecution reflects the seriousness with which my office takes corruption and fraud in the public sector, and we hope that today’s sentence deters other government employees from lining their pockets at the expense of the public.”

The investigation was conducted by the Department of Labor-Office of Inspector General and the IRS with help from the Michigan Unemployment Insurance Agency.

“It’s shocking and discouraging when someone hired by the UIA uses the cover of a global economic crisis to scheme with others to steal taxpayer money for their own gratification,” said Julia Dale, director of the Michigan UIA. “Michigan’s unemployment program is an important lifeline for workers who lose their jobs and despicable actions by bad actors such as Semaje Reffigee damage the trust workers have in the system. Reffigee is one of nearly 50 criminals so far who have been convicted of unemployment insurance fraud, and she won’t be the last. We won’t tolerate such shameful behavior and will continue to work with our law enforcement partners to root out fraudsters, both within and outside of the UIA, and strengthen the program’s integrity.”

According to the terms of her plea agreement, Reffigee is required to repay $313,497 in restitution to the state of Michigan.

In a sentencing memorandum last week, her attorney, Thomas Jakuc, sought a year and one day in prison. He argued his client, who has a young daughter, "clearly demonstrated acceptance of responsibility for her offense."

"It should be further considered by this Honorable Court that the money pocketed by defendant Semaje Reffigee was used solely for maintenance and support regarding her responsibilities as mother and tenant in her grandmother’s house, and to provide care and attention to her disabled uncle who is paralyzed on his left side due to a stroke and ambulates with a cane," Jakuc said. "None of the monies were used for “bling” or other extravagant indulgences or unnecessaries. Defendant Semaje Reffigee further participated in a proffer and implicated others involved and offered to be a cooperating witness, but as of this date, there is no indication that prosecution has been initiated against others involved in the fraud."

The case follows a string of others related to illegally receiving aid during the COVID-19 pandemic.

Last month, a Battle Creek couple was sentenced in connection with deceiving authorities to receive more than $216,000 in pandemic relief and other federal assistance.

The Department of Justice recently announced six Michigan residents were part of a group indicted after an FBI probe linked them to a $6 million pandemic relief fraud scheme. A former Michigan UIA contract worker pleaded guilty to stealing more than $550,000 in a plot.

Last year, an ex-UIA lead claims examiner received a two-year federal prison sentence for a scheme that investigators said diverted about $1 million from the state.

A 2021 state audit found the UIA lost more than $8.5 billion to suspected fraudulent payments amid record claims and persistent attempts at fraud.