One of the highest rates of fraud involving federal disability benefits has been discovered in Puerto Rico after an investigation initially started in 2009 didn’t gain more momentum until a shocking 2011 article.
Back in 2011, The Wallstreet Journal reported that the largest number of people receiving Social Security disability benefits came from the island country with findings listing many Puerto Ricans in the country received benefits due to “mood disorders,” and after suspicion led to a deep surveillance and a heavy analysis of medical records, officials proved the claims were fraudulent.
“There has never been a case like this in the history of the Social Security Administration,” said U.S. Attorney Rosa Emilia Rodríguez-Vélez and added that if, “this fraudulent activity hadn’t been stopped, the government would have lost more than $35 million.”
Last Friday, indictments were handed out against 70 people in Puerto Rico after a two-year investigation revealed that a widespread Social Security disability fraud had been occurring in the island. The announcement about the fraud was not made until this past Wednesday–August 28th, 2013–because law enforcement officers were still making arrests, according to federal prosecutors.
Among those charged with Social Security disability fraud were three doctors and a former Social Security Administration employee. Federal prosecutors said that Samuel Torres-Crespo was the ring leader of this scheme that aided people in obtaining disability benefits they did not qualify for in order to receive a cutback.
Torres-Crespo, an employee for Social Security, would make intakes of fraudulent applications for claimants who had none of the listed medical disabilities that would disable them from working. The people Torres-Crespo would accept applications for would then be sent to one of the three doctors working with Torres-Crespo who would evaluate and make documented diagnosis for each claimant.
The doctors working under Torres-Crespo were Doctor Rafael Miguez-Balseiro, a psychiatrist, Doctor Erica Rivera-Castro, a rehabilitation specialist, and Doctor Wildo Vargas, also a psychiatrist. The licensed doctors would back the fraudulent claims stating that the claimants had either severe back pain or suffered from “disabling psychiatric conditions,” that consisted of suicidal thoughts or depression, according to federal prosecutors.
With the false claims processed, claimants would receive a lump sum payment made by the Social Security Administration. After the fraudulent claimants received their payment, Torres-Crespo would collect 25% from each false claim with the doctors receiving either $150 to $500 for each fraudulent medical report they had submitted.
A total of 71 people were discovered in making fraudulent medical claims that they were eventually given Social Security disability benefits. These 71 people were also charged with Torres-Crespo and if convicted would have to forfeit more than $2 million, according to authorities.
In a statement about the fraud ring, the United States attorney’s office in Puerto Rico said that the fraud disability claims conducted by the Social Security Administration in Puerto Rico revealed that “Puerto Rico is one of the top districts in the country for the commission of this type of fraud.”
Republican Representative Sam Johnson of Texas and the Social Security chairman of the Ways and Means Subcommittee, said in a statement that, “such fraud could occur in the first place raises serious and troubling questions regarding Social Security’s management of the disability program.”
In addition to having 24 units established in states throughout the U.S., Representative Ryan‘s agency has established a unit in San Juan, Puerto Rico to help investigate possible Social Security fraud.
Workers who truly are suffering and have been certified as disabled they are entitled to benefits that is a part of the Social Security Disability Insurance Program. In some cases these benefits can be extended to the disabled worker’s family members. In order to qualify claimants must have been employed and paid Social Security taxes during their employment.
This program is financed by Social Security taxes paid by workers and employers. So the fraudulent claims seen in Puerto Rico not only affects the Federal Government, but hurts other applicants who may be denied acceptance due to limited funds that has been absorbed by false claims.
Currently, there are special investigative agencies looking into claims being made and according to U.S. attorney Rodríguez-Vélez there could be more arrests to come.