PORT ST. LUCIE, Fla. — If you receive Social Security payments and you get a letter saying your monthly check is being deposited into a new account, don’t ignore it.
It could signal that your check has been stolen — by thieves who pilfer your personal information first, then use it when they contact Social Security and pretend to be you.
Since 2011, authorities have been tracking a nationwide scam that diverts Social Security Administration checks from seniors by rerouting monthly payments using direct deposit systems at financial institutions.
Social Security’s Office of Inspector General has logged 144 complaints from residents in Martin, St. Lucie and Indian River counties that their direct deposits have been stolen, according to Jonathan L. Lasher, assistant inspector general for external relations.
In January, the agency had recorded 29,000 reports of questionable direct deposit changes to a beneficiary’s record, Lasher said. But that doesn’t mean every complaint represents a fraud victim, he said. Some changes or attempted changes resulted from duplications or errors.
Thieves perpetrating these schemes are often organized, elusive and extremely tough to catch.
Social Security’s Inspector General Patrick P. O’Carroll, who in September testified before a U.S. House subcommittee, called direct deposit scams a “serious challenge for the agency and its beneficiaries.”
Scammers typically gain the name, bank account number and sometimes Social Security numbers of victims through phony lottery and sweepstakes schemes using the telephone and sometimes email. Some phone scams involve criminals impersonating an official with the IRS, Medicare or Federal Emergency Management Agency who try to extract personal information from unsuspecting seniors.
O’Carroll said last year federal agents tracked one criminal group with roots in Jamaica that “reached across the United States.”
“Suspects have predominantly targeted older citizens’ personally identifiable information through various methods of social engineering, such as telemarketing and lottery schemes,” O’Carroll testified.
Federal officials say once thieves gain a victim’s personal information, they use it to pose as the beneficiary to contact Social Security by phone, mail and the Internet to reroute checks to a financial account the thief controls. Funds often are diverted to prepaid debit cards that come with a bank account and routing number.
To their detriment, some seniors are ignoring a letter sent by Social Security that announces a change to their direct deposit payments has been received and was being implemented “as requested.”
However, the “request” to redirect a deposit was all part of the fraud, many seniors discover, generated by whoever obtained enough personal information to impersonate a legitimate beneficiary.
Prepaid debit cards
O’Carroll in September told Congress beneficiaries can redirect their benefits to a prepaid debit card by using any of Social Security’s direct deposit change methods, including the phone and Internet.
Because debit cards can be purchased at retail stores or online, O’Carroll has urged the U.S. Treasury to develop unique routing numbers for prepaid debit cards.
“These cards are particularly tempting tools for benefit thieves,” O’Carroll testified in September.
According to Brian Ruby, with the public relations firm ICR in Norwalk, Conn., Green Dot Corp. is the program manager for Wal-Mart’s MoneyCard prepaid debit card issued by GE Capital Retail Bank. Green Dot also issues its own prepaid debit cards under the names “Green Dot Prepaid Visa” cards and “Green Dot Prepaid MasterCard” cards, which are issued by Green Dot Bank and are sold at 60,000 retail stores nationwide such as CVS and Walgreens.
In a statement from Green Dot Corp., which Ruby emailed to Scripps Treasure Coast Newspapers, the company said it uses “stringent and highly robust” identity verification systems and technologies.
“We have partnered with the (U.S.) Treasury and the Social Security Administration to help minimize the risks to the financial system posed by identity thieves,” Green Dot stated. “Despite these efforts, we are aware that identity thieves are constantly becoming more sophisticated in the tactics they deploy to obtain the information used to defraud individuals, the government and the banking system.”
Stopping the Scam
Miami-based U.S. Attorney Wifredo A. Ferrer said South Florida and the Treasure Coast have seen a sharp increase in stolen identity crimes, including the Social Security direct deposit scam, mortgage and tax refund fraud. He said in 2011 Florida recorded the highest identity theft rate in the country, logging 178 complaints per 100,000 residents.
Ferrer noted the 2012 federal case of Jakisha Fergus and Natalie Underwood, who were convicted in West Palm Beach of acquiring stolen Social Security numbers to reroute benefit checks to Direct Express debit cards issued by Social Security.
“When law enforcement searched the defendants’
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