I watched the House Social Security Subcommittee hearing today on the alleged Social Security disability fraud ring in Puerto Rico. It wasn't a news packed event. Subcommittee members expressed outrage at the allegations, of course. Many Subcommittee members seemed interested in preventing this sort of thing from happening in the first place rather than dealing with it after it has happened. The answer to that, of course, is that Social Security would like to prevent this sort of thing from ever happening but crime prevention only gets you so far. Banks, for instance, make extensive efforts to prevent fraud but bank fraud still happens and must be dealt with after the fact. Members also wanted to know how much of the alleged overpayments would be recouped and seemed skeptical at the testimony that most would be recouped. I don't think they realize that the lack of a statute of limitations gives Social Security an almost limitless opportunity to recoup overpayments, a good thing when you're talking about overpayments due to fraud but a questionable thing when you're talking about overpayments that happened through no fault of the beneficiary.
Of particular interest to me was something that I had earlier predicted. Bea Disman, Social Security's Regional Commissioner for the region covering Puerto Rico, testified that some of the claimants involved in this alleged fraud really are disabled. A person unfamiliar with these cases might think that all of the cases involved in this alleged fraud scheme would be complete fabrications but that's not the way something like this would work or could work. If all the cases were complete fabrications, the fraud would have been discovered more quickly. Even someone as dimwitted as the non-attorney representative involved in these allegations appears to be could have figured that out. This alleged scheme lasted as long as it did -- and it wasn't that long -- because there was other, genuine evidence supporting the award of disability benefits in many cases. Probably, what you had here, in many cases, was gilding the lily. Why would someone gild the lily, that is add fraudulent evidence on top of genuine evidence of disability? Perhaps because they relied upon the advice of a former Social Security employee who told them this was what they should do. Perhaps because they felt real urgency to be approved as quickly as possible. Perhaps because they were people who were more than willing to lie to get something they wanted. It's even possible that some of the claimants didn't even know that this was done on their behalf.
As I think about this alleged scheme in Puerto Rico, all I can say is what I've said before. It was dumb, dumb, dumb. There was no way it could keep going indefinitely. I can't think of a way that a sophisticated scheme would have worked indefinitely but I can't imagine why a sophisticated person would even try to come up with a scheme. There's too much risk for too little gain. It's not easy but there is money to be made representing Social Security disability claimants honestly.