II 

114TH CONGRESS 

1ST SESSION S. 1929 

To amend the Social Security Act to prevent disability fraud, and for other 

purposes. 

IN THE SENATE OF THE UNITED STATES 

AUGUST 4, 2015 

Mr. HATCH (for himself, Mr. COATS, Mr. LANKFORD, and Mr. BLUNT) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To amend the Social Security Act to prevent disability fraud, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Disability Fraud Re5 duction and Unethical Deception (FRAUD) Prevention 

6 Act’’. 


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1 SEC. 2. IMMEDIATE SUSPENSION OF CLAIMANT REP2 RESENTATIVES UPON FELONY CONVICTIONS 

3 OR DISBARMENT. 

4 Section 206(a)(1) of the Social Security Act (42 

5 U.S.C. 406(a)(1)) is amended— 

6 (1) in the third sentence, by striking ‘‘disbarred 

7 or’’ each place it appears; and 

8 (2) by inserting after the third sentence the fol9 lowing: ‘‘Upon conviction of an individual for a fel10 ony in a Federal or State Court or, in the case of 

11 an attorney, upon disbarment from any court or bar 

12 to which he or she was previously admitted to prac13 tice, the Commissioner may, after due notice, imme14 diately disqualify or suspend the individual from ap15 pearing as a claimant representative before the So16 cial Security Administration, pending an expedited 

17 hearing.’’. 

18 SEC. 3. NEW AND STRONGER PENALTIES. 

19 (a) CONSPIRACY TO COMMIT SOCIAL SECURITY

20 FRAUD.— 

21 (1) AMENDMENT TO TITLE II.—Section 208(a) 

22 of the Social Security Act (42 U.S.C. 408(a)) is 

23 amended— 

24 (A) in paragraph (7)(C), by striking ‘‘or’’ 

25 at the end; 


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1 (B) in paragraph (8), by adding ‘‘or’’ at 

2 the end; and 

3 (C) by inserting after paragraph (8) the 

4 following: 

5 ‘‘(9) conspires to commit any offense described in any 

6 of paragraphs (1) through (8),’’. 

7 (2) AMENDMENT TO TITLE VIII.—Section 

8 811(a) of such Act (42 U.S.C. 1011(a)) is amend9 ed— 

10 (A) in paragraph (3), by striking ‘‘or’’ at 

11 the end; 

12 (B) in paragraph (4), by striking the 

13 comma and adding ‘‘; or’’ at the end; and 

14 (C) by inserting after paragraph (4) the 

15 following: 

16 ‘‘(5) conspires to commit any offense described in any 

17 of paragraphs (1) through (4),’’. 

18 (3) AMENDMENT TO TITLE XVI.—Section 

19 1632(a) of such Act (42 U.S.C. 1383a(a)) is amend20 ed— 

21 (A) in paragraph (3), by striking ‘‘or’’ at 

22 the end; 

23 (B) in paragraph (4), by adding ‘‘or’’ at 

24 the end; and 


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1 (C) by inserting after paragraph (4) the 

2 following: 

3 ‘‘(5) conspires to commit any offense described in any 

4 of paragraphs (1) through (4),’’. 

5 (b) INCREASED CRIMINAL PENALTIES FOR CERTAIN

6 INDIVIDUALS VIOLATING POSITIONS OF TRUST.— 

7 (1) AMENDMENT TO TITLE II.—Section 208(a) 

8 of the Social Security Act (42 U.S.C. 408(a)), as 

9 amended by subsection (a), is further amended by 

10 striking the period at the end and inserting ‘‘, except 

11 that in the case of a person who receives a fee or 

12 other income for services performed in connection 

13 with any determination with respect to benefits 

14 under this title (including a claimant representative, 

15 translator, or current or former employee of the So16 cial Security Administration), or who is a physician 

17 or other health care provider who submits, or causes 

18 the submission of, medical or other evidence in con19 nection with any such determination, such person 

20 shall be guilty of a felony and upon conviction there21 of shall be fined under title 18, United States Code, 

22 or imprisoned for not more than ten years, or 

23 both.’’. 

24 (2) AMENDMENT TO TITLE VIII.—Section 

25 811(a) of such Act (42 U.S.C. 1011(a)), as amended 


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1 by subsection (a), is further amended by striking the 

2 period at the end and inserting ‘‘, except that in the 

3 case of a person who receives a fee or other income 

4 for services performed in connection with any deter5 mination with respect to benefits under this title (in6 cluding a claimant representative, translator, or cur7 rent or former employee of the Social Security Ad8 ministration), or who is a physician or other health 

9 care provider who submits, or causes the submission 

10 of, medical or other evidence in connection with any 

11 such determination, such person shall be guilty of a 

12 felony and upon conviction thereof shall be fined 

13 under title 18, United States Code, or imprisoned 

14 for not more than ten years, or both.’’. 

15 (3) AMENDMENT TO TITLE XVI.—Section 

16 1632(a) of such Act (42 U.S.C. 1383a(a)), as 

17 amended by subsection (a), is further amended by 

18 striking the period at the end and inserting ‘‘, except 

19 that in the case of a person who receives a fee or 

20 other income for services performed in connection 

21 with any determination with respect to benefits 

22 under this title (including a claimant representative, 

23 translator, or current or former employee of the So24 cial Security Administration), or who is a physician 

25 or other health care provider who submits, or causes 


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1 the submission of, medical or other evidence in con2 nection with any such determination, such person 

3 shall be guilty of a felony and upon conviction there4 of shall be fined under title 18, United States Code, 

5 or imprisoned for not more than ten years, or 

6 both.’’. 

7 (c) INCREASED CIVIL MONETARY PENALTIES FOR

8 CERTAIN INDIVIDUALS VIOLATING POSITIONS OF

9 TRUST.—Section 1129(a)(1) of the Social Security Act 

10 (42 U.S.C. 1320a–8(a)(1)) is amended, in the matter fol11 lowing subparagraph (C), by inserting after ‘‘withholding 

12 disclosure of such fact’’ the following: ‘‘, except that in 

13 the case of such a person who receives a fee or other in14 come for services performed in connection with any such 

15 determination (including a claimant representative, trans16 lator, or current or former employee of the Social Security 

17 Administration) or who is a physician or other health care 

18 provider who submits, or causes the submission of, medical 

19 or other evidence in connection with any such determina20 tion, the amount of such penalty shall be not more than 

21 $7,500’’. 

22 (d) ESTABLISHMENT OF SANCTIONS FOR VIOLA23 TIONS BY CLAIMANT REPRESENTATIVES.—Section 

24 206(a)(1) of the Social Security Act (42 U.S.C. 406(a)(1)) 

25 is amended by inserting after ‘‘or who violates any proviVerDate Sep 11 2014 22:08 Aug 10, 2015 Jkt 049200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1929.IS S1929

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1 sion of this section for which a penalty is prescribed.’’ the 

2 following: ‘‘The Commissioner of Social Security shall es3 tablish rules under which fines and other sanctions the 

4 Commissioner determines to be appropriate may be im5 posed and collected for failure to comply with the Commis6 sioner’s rules and regulations.’’. 

7 (e) CIVIL MONETARY PENALTY ON CLAIMANT REP8 RESENTATIVES.—Section 1129(a) of the Social Security 

9 Act (42 U.S.C. 1320a–8(a)) is amended by adding at the 

10 end the following: 

11 ‘‘(4) Any person (including an organization, 

12 agency, or other entity) who, while acting as a 

13 claimant representative pursuant to section 206, 

14 knowingly charges, demands, receives, or collects for 

15 services rendered in excess of the maximum fee pre16 scribed by the Commissioner of Social Security or al17 lowed by a court in connection with proceedings be18 fore the court to which section 206(b)(1) is applica19 ble, shall be subject to, in addition to any other pen20 alties that may be prescribed by law, a civil mone21 tary penalty of not more than $7,500 for each viola22 tion. Such person shall also be subject to an assess23 ment, in lieu of damages sustained by the United 

24 States resulting from the improper payment, of not 


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1 more than twice the amount of any payments so re2 ceived.’’. 

3 (f) INFLATION ADJUSTMENT OF CERTAIN CIVIL

4 MONETARY PENALTIES.—Title XI of the Social Security 

5 Act (42 U.S.C. 1301 et seq.) is amended by inserting after 

6 section 1129B the following: 

7 ‘‘SEC. 1129C. CIVIL MONETARY PENALTY INFLATION AD8 JUSTMENT. 

9 ‘‘(a) ADJUSTMENT BY REGULATION.—The Commis10 sioner of Social Security shall, not later than 180 days 

11 after the date of enactment of the Disability Fraud Reduc12 tion and Unethical Deception (FRAUD) Prevention Act, 

13 and at least once every 4 years thereafter— 

14 ‘‘(1) by regulation adjust the maximum amount 

15 of each civil monetary penalty by the inflation ad16 justment described under subsection (b); and 

17 ‘‘(2) publish each such regulation in the Fed18 eral Register. 

19 ‘‘(b) AMOUNT OF ADJUSTMENT.—The inflation ad20 justment under subsection (a) shall be determined by in21 creasing the maximum amount of each civil monetary pen22 alty by the cost-of-living adjustment. Any increase deter23 mined under this subsection shall be rounded to the near24 est— 


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1 ‘‘(1) multiple of $1,000 in the case of penalties 

2 greater than $1,000 but less than or equal to 

3 $10,000; and 

4 ‘‘(2) multiple of $5,000 in the case of penalties 

5 greater than $10,000 but less than or equal to 

6 $100,000. 

7 ‘‘(c) DEFINITIONS.—For purposes of this section— 

8 ‘‘(1) the term ‘civil monetary penalty’ means— 

9 ‘‘(A) a penalty imposed by paragraph (1), 

10 (3), or (4) of section 1129(a); and 

11 ‘‘(B) a penalty imposed by paragraph (1) 

12 or (2) of section 1140(b); and 

13 ‘‘(2) the term ‘cost-of-living adjustment’ means 

14 the percentage (if any) for each civil monetary pen15 alty by which— 

16 ‘‘(A) the Consumer Price Index for all 

17 Urban Consumers (CPI–U) for the month of 

18 June of the calendar year preceding the adjust19 ment, exceeds 

20 ‘‘(B) the CPI–U for the month of June of 

21 the calendar year in which the amount of such 

22 civil monetary penalty was last set or adjusted 

23 pursuant to law. 

24 ‘‘(d) APPLICATION OF INCREASE.—Any increase 

25 under this Act in a civil monetary penalty shall apply only 


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1 to violations which occur after the date the increase takes 

2 effect.’’. 

3 (g) MANDATORY RESTITUTION IN SOCIAL SECURITY

4 FRAUD CASES.— 

5 (1) AMENDMENTS TO TITLE II.—Section 208(b) 

6 of the Social Security Act (42 U.S.C. 408(b)) is 

7 amended— 

8 (A) in paragraph (1), by striking ‘‘may 

9 order’’ and inserting ‘‘shall order’’; 

10 (B) in paragraph (2), by striking ‘‘3663’’ 

11 and inserting ‘‘3663A’’; 

12 (C) by striking paragraph (3); and 

13 (D) by redesignating paragraphs (4) and 

14 (5) as paragraphs (3) and (4), respectively. 

15 (2) AMENDMENTS TO TITLE VIII.—Section 

16 811(b) of such Act (42 U.S.C. 1011(b)) is amend17 ed— 

18 (A) in paragraph (1), by striking ‘‘may 

19 order’’ and inserting ‘‘shall order’’; 

20 (B) in paragraph (2), by striking ‘‘3663’’ 

21 and inserting ‘‘3663A’’; 

22 (C) by striking paragraph (3); and 

23 (D) by redesignating paragraph (4) as 

24 paragraph (3). 


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1 (3) AMENDMENTS TO TITLE XVI.—Section 

2 1632(b) of such Act (42 U.S.C. 1383a(b)) is amend3 ed— 

4 (A) in paragraph (1), by striking ‘‘may 

5 order’’ and inserting ‘‘shall order’’; 

6 (B) in paragraph (2), by striking ‘‘3663’’ 

7 and inserting ‘‘3663A’’; 

8 (C) by striking paragraph (3); and 

9 (D) by redesignating paragraph (4) as 

10 paragraph (3). 

11 (4) EFFECTIVE DATE.—The amendments made 

12 by paragraphs (1), (2), and (3) shall apply with re13 spect to violations occurring on or after the date of 

14 the enactment of this Act. 

15 (h) NO BENEFITS PAYABLE TO INDIVIDUALS FOR

16 WHOM A CIVIL MONETARY PENALTY IS IMPOSED FOR

17 FRAUDULENTLY CONCEALING WORK ACTIVITY.—Section 

18 222(c)(5) of the Social Security Act (42 U.S.C. 422(c)(5)) 

19 is amended by inserting after ‘‘conviction by a Federal 

20 court’’ the following: ‘‘, or the imposition of a civil mone21 tary penalty under section 1129,’’. 

22 (i) IMPROVED COLLECTION OF CIVIL MONEY PEN23 ALTIES AND ASSESSMENTS.— 

24 Section 1129(e) of the Social Security Act (42 

25 U.S.C. 1320a–8) is amended— 


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1 (1) by redesignating paragraphs (1) and (2) as 

2 paragraphs (2) and (3), respectively; 

3 (2) by inserting before paragraph (2) the fol4 lowing: 

5 ‘‘(1) Civil money penalties and assessments im6 posed under this section may be compromised by the 

7 Commissioner of Social Security.’’; and 

8 (3) in paragraph (2) (as redesignated by para9 graph (1) of this section), by striking ‘‘Civil money 

10 penalties and assessments imposed under this sec11 tion may be compromised by the Commissioner of 

12 Social Security and may be recovered—’’ and insert13 ing ‘‘To the extent that the Commissioner of Social 

14 Security determines to seek recovery of a civil money 

15 penalty or assessment imposed under this section, 

16 the Commissioner shall promptly seek such recov17 ery—’’. 

18 SEC. 4. REVIEW OF HIGHEST-EARNING CLAIMANT REP19 RESENTATIVES. 

20 Not later than 1 year after the date of the enactment 

21 of this Act and biennially thereafter, the Inspector General 

22 of the Social Security Administration shall conduct bien23 nial reviews of the practices of a sample of the highest 


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1 earning claimant representatives to ensure compliance 

2 with the policies of the Social Security Administration. 

Æ 


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