Making Matters Worse

68706255 - forgetful mother holding baby girl at home

The costs for caring for a child who has a birth injury is usually way more than an average family can afford. (A birth injury settlement can help ensure that there will be adequate funds to help the family and the child live their lives as normally as possible.) A mother from Neosho, Missouri received $4 million on behalf of her infant son from a birth injury settlement. While that sum of money provided her with the funds to take good care of her son, she committed Social Security disabilities fraud by concealing the fact that she had received the large chunk of change. (Like most fraudsters, she got greedy and tried to collect even more money from the Social Security Administration (SSA).)

When the woman’s son was born in 2001, the SSA approved her as her son’s representative payee. (She applied for and was approved to receive Supplemental Security Income for his disabilities.) She was also appointed guardian of her son’s financial affairs through a conservatorship from the birth injury settlement. The funds in the conservatorship were to be used for the support and maintenance of her son, but it was considered both a resource and income. (She was required to report its existence to the SSA.)

In 2005, the mother received the first disbursement of $164,290 from the $4 million birth injury settlement. She was sneaky and kept this income concealed by making false statements to the SSA so that she could continue to receive federal benefits. (And, that’s where her trouble began.)

The mom used money from the conservatorship to purchase a home in 2008. But, she falsely claimed that she paid $400 a month to rent the home where she lived with her son and shared with a co-conspirator. (Co-conspirators always line up when they think they can get a piece of the fraud pie. Perhaps it was the co-conspirator who convinced the mother to lie.) By keeping her $4 million income source a secret, the mother was able to receive approximately $56,138 in Supplemental Security Income her son was not entitled to. (Thanks mom for lying on the SSA applications. Not exactly a great example of telling the truth.)

The 47-year-old Neosho, Missouri mother pleaded guilty to Social Security disabilities fraud for illegally receiving federal disability benefits for her son over seven years. (She didn’t need the SSI support because the conservatorship provided them with a home and income to take care of her disabled son.) She is looking at up to 15 years in prison without parole when sentenced.

It is tragic that the woman’s child was injured during birth, but fortunately, she received a settlement that more than paid for the future care of her son if properly managed. (But, apparently it wasn’t enough and she somehow justified the theft of government funds.)  To make matters worse, now she will have to figure out how to take care of her son if incarcerated. (Depending on the judge’s decision, mother and son could be facing another injury from which they won’t soon recover.)

 Today’s “Fraud of the Day” is based on an article entitled, “Neosho woman pleads guilty to disability benefits fraud,” published by The Joplin Globe on October 24, 2017.

SPRINGFIELD, Mo. — A Neosho woman pleaded guilty Tuesday in federal court to illegally receiving disability benefits for her son while concealing a $4 million settlement they had received.

Kerry D. Sanders, 47, pleaded guilty in U.S. District Court in Springfield to participating in a conspiracy to steal government property and to theft of government property. She faces up to 15 years in prison for the offenses under federal law.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.