Former Claims Manager at Michigan Unemployment Insurance Agency Convicted in COVID-19 Fraud

DETROIT – Jermaine Rose, a former auditor for the Michigan Unemployment Insurance Agency (MUIA), was sentenced to two years in prison today for participating in a $1.5 million pandemic insurance scheme, announced United States Attorney Dawn N. Izoni .

Joining the announcement were Irene Lindow, Special Agent-in-Charge, Chicago Region, US Department of Labor Office of Inspector General and Special Agent in Charge John Marengo of the United States Secret Service’s Detroit Field Office.

Jermaine Rose pleaded guilty on April 22, 2022, to one count of wire fraud for participating in a massive scheme to provide Rose’s co-conspirators with unemployment insurance benefits they were not entitled to.

U.S. Attorney Ison said: “Corrupt employees prevent government from operating efficiently and undermine confidence in all government programs. This prosecution demonstrates the seriousness with which my office takes corruption and fraud in public institutions and our commitment to prosecuting those who have used national crisis as an opportunity to defraud people.

“Jermaine Rose, while employed as an auditor for the State of Michigan Unemployment Insurance Agency, abused his authority to allow more than $920,000 in fraudulent Pandemic Unemployment Assistance payments. Rose took advantage of his position to release payments on those claims in exchange for kickbacks from his co-conspirators. We will continue to work with state and federal partners to investigate those who are using unemployment insurance,” said Special Assistant Irene Lindow, Chicago District, US Department of Labor, Office of the Inspector General.

According to court documents, Rose worked as a case manager at MUIA in April 2020, and as such, had electronic access to the MUIA database. Rose may use personal information to access and approve UI claims submitted to this agency.

Court documents show that beginning in approximately April 2020, Rose conspired with various individuals to defraud MUIA by receiving UI benefits by submitting false UI claims. Rose’s associates sent fraudulent messages to MUIA in the names of various people, some of whom were extorted and some of whom were imposters. These affiliates made false statements on the alleged applicant’s eligibility, and filed false documents to support the fraudulent claims. The partners contact Rose, directly or through intermediaries, and realize the offer. Rose will use his insider access to the MUIA system to approve the claims and release the benefits. Often, the benefits are electronically deposited onto American bank cards and sent to addresses controlled by Rose’s co-conspirators. Rose was often paid for his services, usually between $50 and $150 per touch.

While some of Rose’s accomplices had UI credentials and worked with him to receive benefits in a timely manner, many of Rose’s co-conspirators provided fraudulent UI information. In agreeing to his plea, Rose admitted that he was fully aware that many of the claims he authorized were fraudulent.

Court documents indicate that while it is difficult to provide an exact figure for the losses associated with Rose’s scheme, the conservative estimate of the actual loss in the case is approximately $1,011,000.

The case is being prosecuted by Assistant United States Attorneys John K. Neal and Alyse Wu. The investigation is being conducted jointly by the Department of Labor-Office of the Inspector General and the Secret Service, with assistance from the Michigan Unemployment Insurance Agency.