The death of a spouse is a deeply emotional experience, often accompanied by a whirlwind of feelings. It also brings a series of challenges and responsibilities, one of which is the need to notify the Social Security Administration (SSA) if your deceased spouse was receiving Social Security benefits.
We understand that it may be tempting to avoid this step and continue collecting payments, but it's essential to recognize that doing so constitutes Social Security fraud.
Most people associate Social Security fraud with the theft of someone's Social Security number in an attempt to obtain benefits fraudulently. However, failing to report a spouse's death and unlawfully receiving benefits is one of the most common forms of fraud related to Social Security, and some may even be unaware that it is a federal crime.
Social Security fraud occurs when someone knowingly provides false information or intentionally withholds information to receive benefits to which they are not entitled.
While some individuals may rationalize their actions by believing they are entitled to the benefits based on their spouse's lifelong contributions, the law is unequivocal in classifying this as fraudulent behavior. If you're convicted, the consequences are severe, you could face up to 10 years in federal prison.
Receiving Social Security payments after a spouse's death can be a sensitive situation. It's crucial to understand the laws and follow the correct steps to ensure you're not inadvertently committing fraud.
If a Social Security beneficiary dies, it's crucial to notify the SSA as soon as possible. If a Social Security recipient dies, their surviving spouse or children may be eligible for survivor benefits. Upon the death of a Social Security recipient, survivors are typically entitled to a one-time lump sum death payment of $255.
Common examples of fraud include individuals fraudulently collecting Social Security benefits after a deceased person's death, which is a federal crime. Another form of fraud includes using false information to obtain benefits. Individuals found guilty of Social Security fraud can face fines and imprisonment.
18 U.S.C. 641 and Social Security Fraud
The Social Security Administration (SSA) has pushed back against claims that tens of millions of deceased individuals are still receiving Social Security benefits, saying that outdated recordkeeping has led to incomplete death data in the SSA's system.
The SSA takes immediate action to correct its records and can provide a letter stating that the error has been corrected, which can be shared with other organizations, agencies, and employers.
Social Security fraud related to withholding a spouse's death information is often prosecuted under 18 U.S. Code 641. While this statute does not specifically address Social Security fraud, it governs the theft or misappropriation of federal government property, which includes Social Security funds.
When a person continues to accept benefits on behalf of a deceased individual, they are effectively stealing money that belongs to the United States government by wrongfully converting government funds for personal gain. Under the legal definition provided by 18 U.S.C. 641, this is a prosecutable offense.
What Does the Law Say?
18 U.S. Code 641, Public money, property, or records, says -
"Whoever embezzles, steals, purloins, or knowingly converts to his use or the use of another, or without authority, sells, conveys or disposes of any record, voucher, money, or thing of value of the United States or any department or agency thereof, or any property made or being made under contract for the United States or any department or agency thereof; or
Whoever receives, conceals, or retains the same with intent to convert it to his use or gain, knowing it to have been embezzled, stolen, purloined, or converted-
Shall be fined under this title or imprisoned not more than ten years, or both; but if the value of such property in the aggregate, combining amounts from all the counts for which the defendant is convicted in a single case, does not exceed the sum of $1,000, he shall be fined under this title or imprisoned not more than one year, or both.
The word "value" means face, par, or market value, or cost price, either wholesale or retail, whichever is greater."
Possible Legal Penalties
18 U.S.C. 641 specifies penalties based on the value of the government property involved.
If the amount unlawfully obtained exceeds $1,000 in aggregate value, the offense is classified as a felony. This can result in:
- Fines up to $250,000; and
- Up to 10 years in prison.
If the stolen amount is below $1,000, it is prosecuted as a misdemeanor. Misdemeanor convictions can result in:
- Fines up to $100,000 and/or
- Up to one year in prison.
Beyond criminal penalties, the SSA may also seek restitution, requiring repayment of all wrongfully obtained benefits. This can exacerbate financial difficulties, as garnished wages or liens may be imposed following repayment orders.
Defenses to SS Fraud Charges
Receiving Social Security payments after a spouse's death without reporting it is a form of fraud, and the Social Security Administration (SSA) takes action to recover overpayments and prosecute those involved.
While Social Security fraud is a serious matter, not every accusation ends in conviction. If you are charged with Social Security fraud for failing to notify the SSA of a spouse's death, a skilled federal criminal defense attorney can implement several key defenses to combat the charges. Common defenses include:
- Lack of Intent. To secure a conviction under 18 U.S.C. 641, prosecutors must prove that you knowingly and willfully acted with fraudulent intent. If you were unaware of their responsibility to notify the SSA of their spouse's death, this could undermine the prosecution's argument of intentional wrongdoing.
- Misunderstanding Roles or Automatic Payment Processes. Some individuals may not realize they are unlawfully benefiting from their deceased spouse's Social Security payments. For example, if direct deposit continues into a joint account over which they have access, they may presume it's permissible. Misunderstandings about the intricacies of disability or survivors' benefits can also lead to accidental violations. Again, this argument would show a lack of willful intent on your part.
- Mitigating Restitution and Penalties. Even if wrongdoing is substantiated, proactive restitution agreements and cooperation can play a critical role in reducing penalties. Individuals who voluntarily return the full amount of overpaid funds or cooperate with government agencies often find themselves in better standing during legal proceedings. Courts may take into account a willingness to rectify the situation during sentencing.
What If This Applies to You?
If you have failed to report a spouse's death and have continued to accept Social Security payments, promptly addressing the situation is imperative. Report the matter to the SSA as soon as possible to minimize liability. Voluntary disclosure demonstrates good-faith intentions and may limit ensuing penalties.
You should also consult with an experienced criminal defense attorney as soon as possible, especially if criminal charges have already been filed or are pending. An attorney can review the specific allegations, discuss available protections, and work to achieve the most favorable outcome for your case.
For more information, contact our federal criminal defense law firm, Eisner Gorin LLP, located in Los Angeles, California.
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