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EYE on OIG - October, 2006


SSA OIG Special Agent BadgeOffice of Investigations (OI) Case Highlights

Shop Owner Convicted of Selling Counterfeit Social Security Cards

Working jointly with agents from Immigration and Customs Enforcement (ICE), our Ft. Lauderdale, Florida office conducted an investigation of a print shop owner who sold a cooperating witness a total of four sets of counterfeit Social Security cards and work authorization cards.  A search warrant was executed in December 2005, and Federal agents found hundreds of blank counterfeit documents, including Social Security cards, Florida identification cards, Bahamian work authorization permits, Massachusetts and Florida certificates of vehicle title, Florida marriage certificates, Florida traffic school certificates, and Florida Department of Business and Professional Regulation nursing certificates.

In April 2006, the print shop owner was found guilty of selling counterfeit Social Security cards, aggravated identity theft, fraud and misuse of permits, and possession with intent to transfer five or more false identification documents.  He was sentenced to 65 months in Federal prison, 3 years of supervised release, a $25,000 fine, and a $1,200 special assessment.

Man Sentenced to 27 Months for Theft of Disability Benefits

Our Chicago office investigated a man collecting Title II disability benefits for himself and his two children, while owning and operating a limousine service.  Interviews conducted with his employees, insurance company employees, and family and friends, as well as records obtained from the Bloomington Police Department and various State sources, indicate that he worked the entire time he was receiving benefits.

The man was indicted on theft of government funds, pled guilty, and was sentenced to 27 months’ imprisonment.  He was also ordered to pay restitution of $112,110 to SSA.

Man Freezes Mother’s Body In Order to Collect Benefits

An investigation conducted by our Milwaukee office, with assistance from various Federal and local law enforcement agencies, revealed that from August 2000 until April 2005, a man concealed his mother’s death by placing her body in a chest freezer.  When asked about his mother’s death, the man explained that she died of natural causes in August 2000, and he hid her body because he did not want to be blamed for her death and because he wanted to keep collecting her Social Security benefits.  During that period, he collected approximately $35,690 from SSA.

The man pled guilty to Social Security fraud and was sentenced to 4 months in prison and 4 months of community confinement.  His prison sentence will be served concurrent to a State sentence he is already serving for attempted first-degree murder, first-degree reckless endangerment while armed, and hiding a corpse.  Following his prison term, he will be on supervised release for 2 years and will serve 120 days at a residential reentry center.  The man’s attorney indicated that most of the Social Security money was repaid from money police found in the man’s house and in his bank account.

St. Louis Disability Beneficiary Operates Carpet Cleaning Business

Our office in St. Louis, Missouri investigated a St. Louis woman who had collected Title II disability benefits since 1999, while owning and operating a carpet cleaning business. SSA advised that the woman had made numerous statements denying her work activity.  Agents conducted surveillance of the woman on numerous occasions, and ultimately interviewed her at work.  She admitted to wrongdoing and provided a sworn, written statement to our agents.

The woman pled guilty to making false statements to SSA.  She was sentenced to 3
months’ home confinement and 5 years’ probation, and ordered to pay a court fine of $100 and restitution of $122,125 to SSA.

SSI Recipient Ordered to Repay $52,000 for Concealing Income

Our St. Louis, Missouri office investigated a case of a woman receiving Supplemental Security Income (SSI) benefits who failed to report information to SSA.  The woman concealed a retirement account, casino earnings, security trades, and her true living arrangements.  These items placed her over SSI income limits, making her ineligible for SSI benefits from September 1996 to December 2004.

The woman admitted that she failed to report the information, accepted responsibility for her actions, and offered to repay the full amount to SSA.  She was charged with one count of failure to report and sentenced to serve 6 months’ home confinement and 5 years’ probation.  She was also ordered to pay restitution of $52,076 and a special assessment of $100.

Man Steals Identity of Terminally Ill Individual to Avoid Prosecution

Agents in our New York office, in conjunction with the ICE El Dorado Task Force, discovered that a 42-year-old man had used the identity of several individuals, including some who had the exact name as his own.
The man (who had a prior bank fraud conviction) attempted to fake his own death in order to avoid prosecution.  He later told a judge that the death hoax was an attempt to gain more time to get a lawyer, rather than to avoid prosecution.

Our investigation revealed that the man had contacted at least 12 hospitals and hospices in the New York area to find a terminally ill individual with the same name as his own, in order to assume that identity.  In November 2005, he reported to his defense attorney that he was a terminally ill hospice patient, and gave the lawyer the hospice contact information.  In December 2005, the defense attorney, after calling the hospice and learning that the individual with the same name as his client had died, reported this information to the prosecutor.         

The man’s scheme was revealed due to the persistence of the prosecutor, who did not accept the report of death as given by the man’s attorney.  Further investigation by our agent proved that the prosecutor’s suspicion was correct.  The man was sentenced to 96 months’ imprisonment, to be followed by 5 years of supervised release.

Boyfriend Convicted in Law Student’s Death

The testimony of a special agent from our New York office was instrumental in the conviction of the former boyfriend of a 24-year-old Connecticut law school student who disappeared in 1999 and was later found to have been murdered.  Prosecutors said that the boyfriend killed the law student when she told him she was not going to marry him.  The first-semester law student left the school on a Friday afternoon to return to her family's home but never arrived.  According to the boyfriend, he and his brother killed her in November 1999 and disposed of her body. The woman’s body was never recovered.

Our special agent testified to the woman’s Social Security account information from January 2000 to the present, the time period during which she was reported missing.  The agent testified that wages were posted to the woman’s account until her disappearance, but no work activity was recorded after that time.  In May 2006, the boyfriend was convicted of second-degree murder and sentenced to 27 ½ years in prison.


OCCIG Activities

Woman Conceals Bonds for Son

A Denver woman concealed her son's ownership of several bonds in order to make him eligible to receive SSI benefits.  Her concealment resulted in a $19,523 overpayment to her son.  Although the case was declined criminally and civilly, OCCIG proposed a $5,000 penalty and a $19,523 assessment in lieu of damages against the subject for violating section 1129 of the Social Security Act.  The subject did not contest the proposed penalty and assessment, and submitted a check for the full $24,523. 

Man Uses Fake SSN to Conceal Work

A Florida man concealed earnings from SSA by using a fraudulent SSN to work while receiving benefits under his legitimate number.  An OIG investigation resulted in a criminal prosecution, and the subject was placed on probation.  Although there was no overpayment in this case, OCCIG negotiated a settlement agreement with the subject in which he agreed to pay a $10,000 penalty for making false statements to SSA.

Woman Withholds Resource Information from SSA

An Oregon woman failed to accurately report her true resource level on several SSA eligibility forms.  The subject's resources included two life insurance policies with a cash-out value greater than the allowable limit for SSI.  The subject provided a signed sworn confession to OIG admitting that she knowingly falsified the documents in order to access SSI and Medicaid benefits.  The case was declined for criminal and civil prosecution; however, OCCIG negotiated a settlement agreement with the subject in which she agreed to pay a $10,000 penalty and a $16,642 assessment for making false statements. 


OA Activities

The integrity of the Social Security number (SSN) is one of the major challenges facing SSA.  The following four audit report summaries are examples of steps OA has taken to identify cases of SSN misuse and to protect the integrity of the SSN.

Congressional Response Report:  Compliance with Employment Evidence Requirements for F-1 Students (A-08-06-16075)

In this audit, we looked at foreign students who were granted SSNs based on documentation from their schools that they were authorized to work and were offered employment.  Our audit was designed to determine whether these students were actually attending classes and were employed on campus; we also wanted to identify any vulnerabilities in SSA's procedures in this regard.

F-1 visas are issued to students who will be receiving SSNs because they are eligible to work on campus.  We selected a sample of 250 students representing 59 countries (out of almost 25,000 such visas issued to students in 193 countries between July 15 and September 30, 2005) and contacted their schools to verify their attendance and work status.  Of the 250 students we examined, 240 (96 percent) either accepted or were promised employment on campus, as required by SSA policy.  Nine students (3.6 percent) were not employed, and for one student, we were unable to identify the school. 

We identified two areas of potential concern with this work authorization process.  First, some students accepted employment on campus, but appeared to work only one or two days.   Also, some schools provided employment documentation despite having no intention of actually hiring the student.  In light of this, and based on OIG investigations and input from SSA field offices, we plan to conduct additional work in this area.

SSA’s Program for Issuing Replacement Social Security Cards to Prisoners (A-08-06-16025)

In this audit, we reviewed SSA’s program for issuing replacement SSN cards to prisoners.  In response to the Intelligence Reform and Terrorism Prevention Act of 2004, SSA implemented policies that require replacement card applicants to produce specific identity documents.  However, prisoners are not always able to produce such documents.  To assist these prisoners, SSA field offices may enter into written agreements or Memoranda of Understanding (MOU) with prisons, outlining procedures for processing replacement card applications.  These MOUs allow prison officials to certify that they have extracted relevant information from the official prisoner record to verify the prisoner’s identity.  

While some prison officials attempted to comply with this requirement, we observed that some did not.  Therefore, some replacement card applications were processed without sufficient evidence of the prisoner’s identity.  We also found that some SSA field offices processed prisoners’ replacement card applications when no written agreement or MOU was in effect.  Further, SSA did not always perform on-site inspections of prisons submitting replacement card applications.  

As a result of our review, we made several recommendations, including that SSA perform a review at each prison requesting an MOU to ensure that its procedures for establishing prisoner identity are sufficient.  We also recommended that SSA require field offices to perform annual on-site reviews of prison procedures; and that SSA reemphasize the importance of following procedures when processing prisoner replacement card applications.  SSA agreed with all of our recommendations.

Prisoners’ Access to Social Security Numbers (A-08-06-16082)

In this audit, we assessed the extent to which prisoners have access to SSNs and the potential risks associated with such access.  In 1999, the Government Accountability Office found that inmates in the Federal Bureau of Prisons and State prison systems had access to personal information, including SSNs, through correctional industry work programs.  These inmates performed data entry as well as duplicating and scanning medical records, automobile registrations, and unemployment records for Federal, State or local governments.  

Based on interviews with Department of Corrections officials and work program personnel, and our reviews of prison policies and practices, we are concerned about prisoner access to SSNs.  We identified prisons in 13 States that allowed inmates to access SSNs through various work programs.  Some prisons had taken steps to limit prisoners' access to SSNs, but some continue this practice.  

We recognize that SSA cannot prohibit prisons from allowing prisoner access to SSNs.  However, given the potential threat to SSN integrity, we believe SSA can and should help encourage States to limit SSN access.   Specific recommendations include that SSA:

  • coordinate with Departments of Corrections and correctional industry work programs to educate them about potential risks associated with prisoner access to SSNs;
  • encourage prisons to limit access to SSNs; and
  • promote best practices of prisons that are taking steps to limit access to SSNs.

SSA agreed with our recommendations.

Beneficiaries Paid Under More than One Social Security Number (A-01-06-26022)

In April 2005, we issued a report, Individuals Receiving Benefits Under Multiple SSNs at the Same Address, in which we identified over $9 million in overpayments and a number of cases involving fraud.  SSA agreed to improve its matching processes to identify individuals receiving multiple benefits at the same address.  

As a result of our prior work, we initiated this review to identify individuals who received benefits inappropriately under multiple SSNs at different addresses.  Based on our analysis of approximately 54 million SSA records, we identified 320 individuals who appeared to be receiving either OASDI benefits or SSI payments inappropriately under at least two different SSNs.  Of these, we determined that:

  • 221 individuals received benefits inappropriately under multiple SSNs at different addresses;
  • 212 cases involved possible fraud and 9 cases involved administrative errors;  
  • 88 cases were not overpaid; and
  • 11 cases were still under review as of July 2006.

As of July 2006, the Agency had identified $3 million in overpayments as a result of this audit.  The OIG Office of Investigations (OI) and SSA continue to review these cases, and we expect SSA to assess additional overpayments.  We recommended that SSA continue to work with OI and assess overpayments where appropriate.  SSA agreed with our recommendation.

We also updated our prior audit, Individuals Receiving Benefits Under Multiple SSNs at the Same Address, and found that SSA had assessed an additional $3 million in overpayments through July 2006.

Fight Fraud ImageSSA OIG Fraud Hotline Stats

From September 18 - 22, 2006, the SSA OIG Fraud Hotline reported the following:

Allegation numbers issued – 1,437

Total allegations received this fiscal year – 97,807
Our website provides guidelines for reporting fraud and ways to submit an allegation to our Fraud Hotline. For more information, visit
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Valerie Wood, Editor.
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  Last reviewed or modified Monday Jan 14, 2008