What Happens After Reporting Someone for Disability Fraud?

The theft of disability benefits by someone falsely claiming to be disabled is illegal. By squandering valuable resources needed to support the financial needs of truly disabled people, these false claims put to damage the integrity of the system and contribute to the social stigma some people feel when they need to rely on government benefits to meet daily expenses.

At Sackett and Associates – Lawyers of Disability, we assist genuinely disabled workers and former workers whose impairments prevent them from continuing in the workforce. We do not knowingly help to prepare or file claims for people pretending to be disabled just to get benefits. This blog post explains what happens when someone is reported for disability fraud.

Examples of Disability Fraud

Disability fraud can occur in many different forms. The most obvious example is a completely bogus claim filed by a perfectly able-bodied applicant who is working under the table and collecting SSD or SSI benefits. But fraud can be alleged against claimants for less blatant conduct as well.

A legitimate SSD or SSI benefits recipient could commit fraud even after being validly approved for the benefits they deserve. Others close to the recipient can also commit fraud related to a valid disability claim.

Making false statements on claims: If a truly disabled disability applicant includes false statements in the claim process or during other communications with the Social Security Administration, they are liable to be prosecuted or suffer other sanctions.

Concealing facts or events that affect eligibility for benefits: Concealing the truth is also a form of fraud to the Social Security Administration. It is essentially lying by omission. If a disability claimant has recovered from their disability after successful treatment, continuing to collect disability benefits and keeping the fact of their full recovery secret is a form of disability fraud.

Misusing benefits (by a representative payee): One of the most disturbing forms of disability fraud involves representative payees who convert the disabled recipient’s funds to their own use and pass on substantially less money to the beneficiary than they are entitled to receive.

Only qualified organizations approved by the SSA are legally permitted to take a fee for serving as a representative payee. Unfortunately, individuals serving as representative payers often think they are entitled to a fee and often take money illegally. Representative payees have a fiduciary duty to honestly manage the beneficiary’s funds.

Failing to notify the agency of the death of a beneficiary: Continuing to receive the deceased person’s benefits following their death is clearly disability fraud. The law requires the SSA to be notified immediately if a benefit recipient dies. The payments received into the decedent’s account or their payee after their death must be returned to the government.

Filing claims under another person’s Social Security number (SSN): Believe it or not, criminals file disability claims using false medical records and using someone else’s Social Security number. This is an example of identity fraud which carries very strict criminal penalties, including possible imprisonment for up to 15 years in prison for each count.

Consequences of Disability Fraud

When you report someone for disability fraud, there can be serious consequences for the individual being reported. If you suspect someone of disability fraud and report them, here are some of the potential consequences that they may face:

1. Legal Action: Depending on the severity of the fraud, the individual may face legal action. This could include fines, probation, or even jail time. The exact consequences will vary based on the circumstances of the case and the laws in the jurisdiction where the fraud occurred.
2. Repayment of Benefits: If it is determined that the individual was fraudulently receiving disability benefits, they will be required to pay back the money they received. This can be a significant financial burden, especially if the fraud has been ongoing for an extended period of time.
3. Loss of Benefits: If the individual is found to have committed disability fraud, they will lose their eligibility for benefits. This can greatly impact their quality of life, especially if they rely on those benefits to cover their basic needs.
4. Criminal Record: Individuals convicted of disability fraud will probably have a felony criminal record. This will make it difficult for them to find employment, obtain credit, or find housing in the future.

It is important to remember that reporting someone for disability fraud should not be taken lightly.

While it is important to prevent fraud and ensure that benefits go to those who truly need them, false accusations can also have serious consequences. If you suspect someone of disability fraud, gathering as much evidence as possible and reporting your concerns to the appropriate authorities is the best course of action.

Sackett and Associates Lawyers for Social Security Disability can give you more information about how to identify disability fraud in others and how to avoid falling into the conduct yourself. Financial stress may tempt good people to act out of character. Reach out for help instead so someone can assist you in solving your difficulties without resorting to fraud.