This Problem Will Just Get Worse
From
CBS:
Thousands of Social Security beneficiaries have become victims of
identity thieves who have hacked into their accounts and stolen millions
of dollars in desperately needed benefits.
69-year-old Carole Folkes is one of them. For seven years her $354
Social Security check was directly deposited into her bank account. Then
last June, she said, “The Social Security check wasn’t there and I was
baffled.”
Folkes called Social Security and was told her money was sent to a
different bank and she was supposedly sent a debit card to collect it. ...
Folkes, who is confined to a wheelchair, said she had to make three
trips to her Social Security office to try and straighten it out. In the
weeks it took to get a replacement check, Folkes got an eviction notice
from her building manager because she did not have enough money to pay
the rent. ...
Most often the scammers are hard to track because they operate from different countries. ...
The Inspector General’s office reported this year on an audit that
identified 23,192 beneficiaries who did not receive $28.3 million in
benefits between Sept. 2011 and June 2012 due to unauthorized direct
deposit changes. Of that, $17.4 million has not been recovered. Through
August 2014, 38,585 allegations of direct deposit fraud have been made
by beneficiaries.
6 comments:
And to think that there is no fraud in the system... Right!
Just another example of illegal movement of resources from one place to another. People, money, corporate headquarters, what difference does it make?
The story says people's accounts have been hacked. Anyone who reads that assumes that the person had an account, and then some fraudster/hacker stole the login and password somehow and took over the account.
The IG says fraudsters create new accounts in the names of people who did not already have them. Then they use those accounts to re-direct payments.
Two very different scenarios. The first implies that online accounts are inherently vulnerable and inevitably bad. The second implies that NOT having an online account is bad; the accounts themselves make you safer.
Now SSA (like all the banks that are responsible for the vulnerability of our finances) can put in place some simple protocols to make this type of fraud much harder. For example, sending a mailed notice to the address of record before any new account is allowed to be opened/activated. And requiring a response to that mail before any payment is allowed to be changed.
If it was 23,000 people scamming to get disability benefits, we'd be told that's no big deal and that it's not rampant or an issue. Fraud is Fraud is Fraud. It's funny how some fraud is ok and some is not. How many people receive benefits every month and on time? The percentage of "fraud" here is minute right? We shouldn't care right? That argument doesn't sound as good now, does it?
$354 - pretty low check. Might have something to look at there.
SSA can remove the update deposit account information online button.
Or make the online account a robust read ONLY account. Problem possibly solved.
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