February 23, 2017
Social Security paid a billion dollars
to people with no SS numbers
By Rick Moran
Herer's a tale of government waste involving all the usual
suspects; incompetence, indifference, and laziness.
The inspector general for the Social Security Administration
discovered that a billion dollars in benefits was paid to people who had
no social security numbers. The benefits were paid to "representative
payees" - people who were accepting benefit checks on behalf of another
because the beneficiary was unable to manage their social security payments by
themselves.
Seventeen percent of these representative payees were illegal
aliens, according to the audit.
Over the last decade, the agency paid $1 billion to 22,426 representative
payees who "did not have an SSN, and SSA had not followed its policy to
retain the paper application."
“Furthermore, unless it takes corrective action, we estimate SSA
will pay about $182.5 million in benefits, annually, to representative payees
who do not have an SSN or paper application supporting their selection,” the
inspector general said.
The inspector general also found the agency paid $853.1 million in
benefits since 2004 to individuals who had been terminated as representative
payees by the agency.
The inspector general said the errors occurred because the agency
did not keep paper applications supporting an individual’s case to receive
benefits on behalf of another and did not update its system if their status was
terminated.
Only six percent of representative payees had SSNs that were
properly recorded, based on the audit’s sample of 100 beneficiaries.
Government benefits are also going to illegal aliens through the
representative payee system. 17 percent of representative payees in the sample
did not have an SSN recorded because they were undocumented noncitizens, the
inspector general said.
Illegal aliens without SSNs are allowed to receive benefits from
the government when acting as representatives for their minor children.
In response to the audit, the SSA said it switched to a new
Electronic Representative Payee System last year, and transferring
representative payee information “may have resulted in applications showing as
terminated or not selected.”
The government defended the issuance of benefits to noncitizens
and persons without an SSN.
“Representative payees play a significant role in many
beneficiaries’ lives,” the SSA said. “We have approximately 5.7 million
representative payees managing annual benefits for approximately 8 million
beneficiaries. When appointing representative payees, we adhere to guidance in
the Social Security Act (the Act).”
“Specific to this audit, the Act permits us to appoint, in certain
circumstances, an undocumented alien, or applicant who resides outside the
United States without a Social Security number (SSN) to serve as payee,” the
agency said. “Specifically, the Act states we should verify a person’s SSN (or
employer identification number) in our investigation of the payee applicant.
However, the Act does not state that the applicant must have an SSN to serve as
a payee.”
The “absence of an SSN is not a criterion preventing an individual
from serving as payee,” the agency added.
How many of these checks end up in the "representative
payee's" bank accounts and not the actual beneficiary's? How many are
completely fraudulent, in that the beneficiary only exists on paper? It sounds
like a perfect scheme to rip off the Social Security system.
I can see where a husband or a son or daughter could act
responsibly as a representative payee, and perhaps another relative or close
friend. But the problem is significant enough that verification procedures must
be changed to reflect the reality that a hole has developed through which
fraudsters can bilk the taxpayer for large amounts of money.
Although the audit doesn't indicate where the fraud is most
prevelant, it is logical that the finger of blame is pointing once again at the
Social Security disability program - a prime target for fraudsters in the past.
Congress should take another look at this program and either eliminate it or
fix it.
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