Increasingly Sophisticated Social Security Scams Target Seniors’ Direct Deposit Bank Information

On March 1^st, 2013, the federal government completely phased out paper checks in an attempt to ensure the safety of all benefits payments. Recipients of any federal benefits can either sign up for direct deposit, or they can receive benefits through a debit card issued by the federal government.

The changes specifically affect those who receive Social Security Insurance or Social Security Disability Insurance, veterans’ benefits, and railroad pensions.

The change affects a small number of recipients – currently, 93% of Social Security and Supplemental Security Income payments are paid electronically.

The Treasury Department says that the switch will save taxpayers money – $1 billion in tax money will be saved over 10 years, because  checks will not be printed on paper anymore.

However, the switch to electronic payments is allegedly safer. “Getting your Social Security or Supplemental Security Income payment by direct deposit or Direct Express is safer and more reliable,” Michael J. Astrue, the commissioner of Social Security, said in announcing the change. In 2011, over 440,000 Social Security paper checks were stolen and fraudulently endorsed, and had to be replaced. $70 million in Social Security payments were stolen.

Social Security Fraud Becomes More Sophisticated with Phone Scams

Unfortunately, thieves are already becoming increasingly sophisticated, developing new ways of stealing Social Security recipients’ identities.

A recent article in the Pasadena Citizen reported that Texas authorities warned senior citizens that identity thieves were posing as Medicare officials on the phone, in an attempt to steal bank account information and take their Social Security payments.

The scam involves a thief calling a potential victim, posing as a representative from Medicare, asking to verify personal information to the victim can receive a replacement card. Medicare and social security numbers are identical, but the caller will ask to confirm the victim’s Medicare number, which sounds innocuous. Some seniors became wary of the scam and reported the call to authorities. However, the seniors reported that the thieves were ready to assuage the potential victim’s fears – they could verify the victim’s full name, address, and phone number, which sounds like a legitimate verification often used by banks and insurance companies. This kind of personal information is not hard to obtain, say Texas authorities, so seniors should be wary of callers asking for detailed information.

It is also important to keep in mind that the Internal Revenue Service, Medicare, and other federal programs never reach out to benefits recipients by phone – it is incumbent on the recipient to contact the federal program by phone themselves. Federal agencies communicate with Social Security recipients strictly by mail.

“While the Social Security Administration appears to be working to address this issue, there are some areas we need to continue to monitor that make it easier for this fraud to occur, such as implementing more robust verification procedures before processing Social Security direct deposit changes over the phone and in person.” U.S. Rep. Patrick Murphy, D-Jupiter, said recently.

As of January 2013, the reported cases of Direct Deposit Social Security fraud had grown to 29,000.

The Treasure Coast area of Florida reports that similar scams are also common in the Sunshine State. Sometimes, thieves pretend to call from sweepstakes offices, but most commonly they say they are calling from the IRS or Medicare.

Officials say that if a Social Security recipient receives a letter saying that their benefits have been rerouted to a new bank account, the recipient should immediately contact the Social Security Administration.

The Strom Law Firm Can Help with Social Security Questions and Concerns

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.