Pension/Retirement Fraud

Identity Fraud Scenario

Pension Retirement Fraud: When fraudsters cheat others–even the deceased–in favor of lining their own pockets.

With the population of baby boomers quickly aging, and government budgets quickly decreasing, pension and benefit programs can struggle to meet their financial commitments. Fraud and waste occurs when individuals fail to report information such as address changes, or even worse, when a beneficiary is deceased and a relative continues to collect their benefit.

  • More than $106 billion dollars are lost to improper payments each year, including pension and retirement fraud.

  • “Former officers were among 106 people indicted…in what the Manhattan district attorney’s office says is the largest scheme ever to defraud the Social Security disability insurance system, a plot stretching back to the 1980s that has cost taxpayers an estimated $400 million.”
    - New York Times

  • “Railroad pension fraud scam involving fake disability claims may have cost one agency $1 billion.”
    - New York Post

The anonymous interactions of benefit programs like pension retirement make fraud that much easier to commit. Identity-based fraud perpetrated in Pension and Retirement systems occurs when individuals who are currently receiving benefits are deceased, incarcerated or otherwise ineligible. Yet someone, often family members such as spouses or children, continue to pocket those benefit payments. When a fraudster wants to commit pension retirement fraud, they know no bounds they don't hesitate to involve friends and families in their schemes.

The Federal Office of Management and Budget estimates total overpayments in Pension and Retirement fraud at approximately three billion dollars per year. Fraudsters continue to cash checks or receive electronic payments, without ever alerting the agencies that the real person has passed away or is in jail. In other cases, the fraudsters have to take real action like forging a signature or filling in a form online to continue receiving
the benefits.

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