The Social Security Administration (SSA) has been rife with scandal over the years. And now we have another to add to the list.
A new audit shows the SSA gave $1.3 million in benefits to criminals, including those who previously defrauded the government. This is further evidence that bureaucracy equates to incompetence, at least when it comes to this part of The Swamp.
In 2004, the SSA instituted a policy that prohibited felons from receiving benefits for others. That did not stop criminals from being provided with social security payments.
According to an audit conducted by the agency’s inspector general, 51 individuals serving as payees for 70 beneficiaries were paid approximately $1.3 million in benefits after their convictions. These were recipients who had been convicted of violating criminal sections of the Social Security Act, homicide, fraud, and certain other criminal felonies.
The report discovered that more than $752,000 in retirement or disability funds were given to felons who had stolen government funds or committed some kind of fraud.
One of the reasons this occurred was because the SSA did not have a system to automatically block 936 people convicted of the listed crimes from being chosen as payees in the future. The SSA found that using the organization’s PayeeWiz system, in 2014 and 2015, one-fifth of applicants acting as representative payees were criminals.
Moving forward, the inspector general put together two main recommendations:
We recommended that SSA (i) review the remaining five payees who were convicted of criminal offenses that should have barred them from serving and either select a new payee or consider direct payment; and (ii) consider the feasibility of identifying a source to access Federal criminal information when conducting criminal background checks for payee applicants to prevent individuals convicted of barred crimes from serving as payees.
For decades, the SSA has paid out benefits to questionable receivers.
Last month, a Louisiana woman pleaded guilty to collecting SS following her mother’s death. Lucille Williams, 54, collected about $80,000, telling civil servants that her mother was still alive and she was using the money to care for her.
Many were outraged earlier this year when an internal audit learned that $1 billion was paid to more than 22,000 beneficiaries who did not have a Social Security Number (SSN). It was estimated that 17% of the recipients were illegal aliens – the government permits undocumented workers without SSNs to receive SS when they serve as representatives for their children.
Amid the anger the report generated, the agency defended the issuance to noncitizens:
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. 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 inspector general warned that the SSA could dole out roughly $180 million annually to representative payees who don’t have an SSN.
One of the most famous humiliations for the agency was when it was reported more than 100 suspected Nazi war criminals, SS guards and other members of the Third Reich received $20.2 million in benefits. The payments occurred between February 1962 and January 2015 and ceased when the No Social Security for Nazis Act was passed by Congress.
Ostensibly, the Department of Justice (DOJ) was aware of this happening. The Associated Press noted that the Justice Department took advantage of a legal loophole that allowed Nazi suspects to exit the U.S. in exchange for SS money. If the suspects fled the country voluntarily before being deported, then they could keep that income. The DOJ denies this ever transpired.
The SSA is one of the most inefficient government agencies in the U.S. today. Not only is it forking over cash to criminals, illegal aliens and people who should not be given this entitlement, it is also on the cusp of bankruptcy.
Since the SS is a Ponzi scheme – the program relies on new investors to pay yesterday’s investors – it is going broke. According to Charles Blahous, a senior research fellow at George Mason University’s Mercatus Center, Social Security faces a $11.4 trillion shortfall and will begin to tap reserves in two years. After 2019, SS will pay out more than it takes in, and that means it will begin to deplete the reserve fund.
Blahous said in a report:
Just to keep the system afloat from year to year at that point they would have to inflict near-term pain over three times as severe as was the case in 1983. The politics of Social Security reform is not getting any easier. When the trust funds run out, it will be too late.
Too few politicians are willing to tackle the problems associated with Social Security. For the last ten years, David Walker, the former Comptroller of the United States, has ventured across the country, warning of inevitable insolvency for both the SS and state pensions. And he isn’t optimistic that something will be done to correct the issue:
Washington has a tendency to put band aids on open wounds, rather than trying to actually do what needs to be done.
Dr. Ron Paul is right: allow the new generation of workers to opt out of the system and gradually shut it down. There is no need to depend on a scheme that steals more money from you than the program gives you. If Bernie Madoff can go to jail for his multibillion-dollar Ponzi ruse, then the politicians should commence winding down this multi-trillion-dollar unconstitutional boondoggle.
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