Federal Authorities Bust Massive Social Security Fraud Ring in Puerto Rico That Raked in Millions of Dollars

Over 70 people have been indicted for their roles in a massive Social Security fraud plot in Puerto Rico, that raked in millions of US Dollars in Social Security Disability payments.

Among those charged were three doctors, and a former Social Security Administration employee, who worked for the office for 32 years before leaving to privately represent SSDI clients. Prosecutors said that he helped people receive SSDI benefits they did not actually qualify for. Seventy-one people who also filed fraudulent Social Security Disability claims were also charged. If they are convicted for Social Security fraud, they would be required to forfeit $2 million.

The US Attorney’s Office of Puerto Rico said in a statement that an analysis of disability claims from the territory, conducted by the Social Security Administration, “suggested that Puerto Rico is one of the top districts in the country for the commission of this type of fraud.”

According to prosecutors, Samuel Torres Crespo, a former employee of the Social Security Administration, was the originator of the plot. He reportedly charged up to $6,000, or 25% of the claim’s back payment, to write fraudulent SSDI claims, then passed his clients to doctors who charged $500 to write fraudulent medical diagnoses, saying their patients were too psychiatrically impaired to work.

Crespo reportedly ended up with $2.5 million total from the Social Security fraud scheme.

“There has never been a case like this in the history of the Social Security Administration,” said U.S. Attorney Rosa Emilia Rodriguez. “If this fraudulent activity hadn’t been stopped, the government would have lost more than $35 million.”

“That such fraud could occur in the first place raises serious and troubling questions regarding Social Security’s management of the disability program,” said Rep. Sam Johnson, Texas Republican and chairman of the House Ways and Means Committee’s panel on Social Security. “Clearly, this isn’t a case of just a few bad apples.”

According to the Congressional Budget Office, Social Security, from retirement benefits to disability payments, is running out of money. The fund is estimated to be depleted between 2016 and 2017. Social security officials say that Social Security fraud is a large part of the funding problem.

Crespo has been charged with mail fraud and wire fraud, among other federal charges. The three doctors – Wildo Vargas, Rafael Miguez Balseiro and Erica Rivera Castro – have received similar charges for their part in the Social Secutiy fraud scheme.

“It’s inevitable that there would be some fraud in a program this large and with benefits this attractive,” said David Autor, an economics professor at Massachusetts Institute of Technology. “But how much of it goes on is something we really don’t know.”

The Social Security Administration said it would be reviewing 6,600 cases, and that those people could potentially lose their benefits.

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Social Security can be complex. Not understanding the basics and not having counsel can leave you in a bind.  We understand that you need your benefits.  We will put our years of experience to work for you to ensure that you have the representation necessary to actively pursue your claim.  Call the attorneys at the Strom Law Firm today to discuss your Social Security Disability or Supplemental Security Income case today. We will be glad to discuss any questions you may have during our free, confidential consultation.  Call the experienced attorneys at the Strom Law Firm at (803)252-4800.