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Letter to Commissioner Michael Astrue, Social Security Administration


Location: Unknown

U.S. Senator Charles E. Schumer today called on the Social Security Administration to implement safety measures for benefit recipients after thousands of seniors have reported being victims of fraud. In a new practice, scammers are getting a hold of the bank account information of a Social Security beneficiary and then, with a simple phone call and minimal information, rerouting the payments to their own accounts. As of August 31, the Social Security Administration's Inspector General received over 19,000 reports of attempted changes to bank account information, and they are currently receiving a shocking 50 additional complaints each day.

To foil scammers, Schumer is calling on the Social Security Administration to provide notification via e-mail, text, letters, and automated phone calls to benefit recipients when their deposit information is changed. Schumer described this as a simple and common sense step that could drastically reduce fraud and save Social Security payments. Schumer was joined by Chris Widelo, Associate State Director for AARP.

"It shouldn't take just one phone call and a scrap of information for a thief to reroute Social Security payments to their own bank account," said Schumer. "Social Security is a lifeline to seniors, and a thief shouldn't be able to sever that line with a snap of their finger. Fortunately there are easy steps that the Social Security Administration can take to protect them, such as requiring immediate notification when bank account information is changed."

The Social Security Administration recently announced that all individuals who applied for benefits on or after May 1, 2011 will receive their payments through direct deposit method or a debit card. Beginning March 1, 2013 all other beneficiaries will have to select an electronic payment method. According to the Office of Inspector General for the Social Security Administration, 94% of beneficiaries already use the electronic payment method. It cuts down on theft of paychecks, administrative costs, and expedites payments to seniors.

A new scam targeting seniors and disabled individuals who receive Social Security benefits is becoming more prevalent across the country. Scammers get their hands on the bank account information and full name of Social Security beneficiaries. Then, they contact the Social Security Administration and ask to have payments rerouted to their own accounts. Scammers often get a hold of bank account information by preying on senior citizens with lottery and prize winning scams. As of August 31, 2012, the Inspector General of the Social Security Administration revealed over 19,000 reports of unauthorized changes to bank account information within the Social Security Administration. The Inspector General recommended that the Social Security Administration develop an automatic notification system to alert beneficiaries if any changes were made to their deposit information.

Schumer today called on the Social Security Administration to implement safety measures that would further protect beneficiaries from this particular scam. Schumer is asking the Social Security Administration to provide notification via email, text, letters, and automated phone calls to benefit recipients when their deposit information has been changed. Schumer noted that senior citizens may be particularly susceptible to this type of a scam and the Social Security Administration should be taking the necessary precautions to prevent fraudulent behavior.

A copy of the letter is below:

October 14, 2012

Commissioner Michael Astrue

Social Security Administration

500 E St., SW

Washington, D.C. 20254

Dear Commissioner Astrue:

I write today requesting your immediate attention to an emerging threat targeting seniors and the disabled. It's come to my attention that an increasing and alarming number of Social Security recipients receiving their benefits through direct deposit have been the victim of identity theft, resulting in their benefits being rerouted by your agency to the thieves' bank accounts. After gaining access to the beneficiary's personal information, the thief simply contacts the Social Security Administration (SSA) and requests that the payments be rerouted to their own account. According to the SSA Office of Inspector General, approximately fifty reports of such questionable changes to account information are reported to the office every day.

I urge you to quickly take action to safeguard the benefits our seniors and disabled rely on. The Inspector General has recommended that the SSA implement steps to better verify the beneficiary's identity before changes to the account are made. Specifically, for changes made to account information over the phone, the SSA should take additional steps to confirm the legitimacy of the transaction. The agency has beneficiary-specific information in its systems it should use to improve verification purposes prior to making the account changes. Additionally, the agency should implement a new notification system to alert beneficiaries that changes have been made to their account, through written confirmation mailed to the beneficiary's home address or through email, text, and automated phone calls. Finally, if a beneficiary fears they are the victim of identity theft, they should be allowed to "freeze' their account, requiring face-to-face verification in an SSA office for any changes to the account.

Again, I ask for your immediate attention to this matter and look forward to receiving your response.


Charles E. Schumer

U.S. Senator

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