Disability Fraud Reduction and Unethical Deception (FRAUD) Prevention Act

Bill: 114-s-1929
Sponsor: full_name: Sen. Hatch, Orrin G. [R-UT]
Introduced: 2015-08-04
Policy area: Social Welfare
Subjects: Administrative law and regulatory procedures

Civil actions and liability

Crime victims

Disability assistance

Fraud offenses and financial crimes

Government studies and investigations

Lawyers and legal services

Poverty and welfare assistance

Social Security Administration

Social security and elderly assistance

Wages and earnings
Latest action: action_date: 2015-08-04
text: Read twice and referred to the Committee on Finance. (Sponsor introductory remarks on measure: CR S6297-6299)

Summaries:
action_date: 2015-08-04
action_desc: Introduced in Senate
text: <p><b>Disability Fraud Reduction and Unethical Deception (FRAUD) Prevention Act </b></p> <p>Amends title II (Old Age, Survivors and Disability Insurance) of the Social Security Act (SSAct) to authorize the Social Security Administration (SSA) to disqualify or suspend immediately from appearing as a claimant representative before it any individual who has been convicted of a felony in a federal or state court, or, in the case of an attorney, upon the individual's disbarment from any court or bar to which he or she was previously admitted to practice.</p> <p>Amends SSAct titles II, VIII (Special Benefits for Certain World War II Veterans), and XVI (Supplemental Security Income) to subject to criminal penalties for fraud any conspiracy to commit specified offenses, and increase criminal as well as civil monetary penalties for certain individuals in positions of trust who commit fraud.</p> <p>Amends SSAct title II to direct the SSA to establish rules under which fines and other appropriate sanctions may be imposed on claimant representatives for failure to comply with the SSA rules and regulations.</p> <p>Amends SSAct title XI to: (1) establish a civil monetary penalty for any claimant representative who knowingly charges for services rendered in excess of the maximum fee prescribed by the SSA or allowed by a court, and (2) direct the SSA periodically to adjust civil monetary penalty maximum amounts for inflation.</p> <p>Requires federal courts (which currently are merely authorized) to order defendants convicted of Social Security fraud to provide restitution to victims in certain cases.</p> <p>Amends SSAct title II to ban any payment of benefits to individuals on whom a civil monetary penalty is imposed for fraudulently concealing work activity.</p> <p>Directs the Inspector General of the SSA to conduct biennial reviews of the practices of a sample of the highest earning claimant representatives to ensure compliance with SSA policies.</p>

tv_txt: II 114th CONGRESS 1st Session S. 1929 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. Short title This Act may be cited as the Disability Fraud Reduction and Unethical Deception (FRAUD) Prevention Act . 2. Immediate suspension of claimant representatives upon felony convictions or disbarment Section 206(a)(1) of the Social Security Act ( 42 U.S.C. 406(a)(1) ) is amended— (1) in the third sentence, by striking disbarred or each place it appears; and (2) by inserting after the third sentence the following: Upon conviction of an individual for a felony in a Federal or State Court or, in the case of an attorney, upon disbarment from any court or bar to which he or she was previously admitted to practice, the Commissioner may, after due notice, immediately disqualify or suspend the individual from appearing as a claimant representative before the Social Security Administration, pending an expedited hearing. . 3. New and stronger penalties (a) Conspiracy To commit Social Security fraud (1) Amendment to title II Section 208(a) of the Social Security Act ( 42 U.S.C. 408(a) ) is amended— (A) in paragraph (7)(C), by striking or at the end; (B) in paragraph (8), by adding or at the end; and (C) by inserting after paragraph (8) the following: (9) conspires to commit any offense described in any of paragraphs (1) through (8), . (2) Amendment to title VIII Section 811(a) of such Act ( 42 U.S.C. 1011(a) ) is amended— (A) in paragraph (3), by striking or at the end; (B) in paragraph (4), by striking the comma and adding ; or at the end; and (C) by inserting after paragraph (4) the following: (5) conspires to commit any offense described in any of paragraphs (1) through (4), . (3) Amendment to title XVI Section 1632(a) of such Act ( 42 U.S.C. 1383a(a) ) is amended— (A) in paragraph (3), by striking or at the end; (B) in paragraph (4), by adding or at the end; and (C) by inserting after paragraph (4) the following: (5) conspires to commit any offense described in any of paragraphs (1) through (4), . (b) Increased criminal penalties for certain individuals violating positions of trust (1) Amendment to title II Section 208(a) of the Social Security Act ( 42 U.S.C. 408(a) ), as amended by subsection (a), is further amended by striking the period at the end and inserting , except that in the case of a person who receives a fee or other income for services performed in connection with any determination with respect to benefits under this title (including a claimant representative, translator, or current or former employee of the Social Security Administration), or who is a physician or other health care provider who submits, or causes the submission of, medical or other evidence in connection with any such determination, such person shall be guilty of a felony and upon conviction thereof shall be fined under title 18, United States Code, or imprisoned for not more than ten years, or both. . (2) Amendment to title VIII Section 811(a) of such Act ( 42 U.S.C. 1011(a) ), as amended by subsection (a), is further amended by striking the period at the end and inserting , except that in the case of a person who receives a fee or other income for services performed in connection with any determination with respect to benefits under this title (including a claimant representative, translator, or current or former employee of the Social Security Administration), or who is a physician or other health care provider who submits, or causes the submission of, medical or other evidence in connection with any such determination, such person shall be guilty of a felony and upon conviction thereof shall be fined under title 18, United States Code, or imprisoned for not more than ten years, or both. . (3) Amendment to title XVI Section 1632(a) of such Act ( 42 U.S.C. 1383a(a) ), as amended by subsection (a), is further amended by striking the period at the end and inserting , except that in the case of a person who receives a fee or other income for services performed in connection with any determination with respect to benefits under this title (including a claimant representative, translator, or current or former employee of the Social Security Administration), or who is a physician or other health care provider who submits, or causes the submission of, medical or other evidence in connection with any such determination, such person shall be guilty of a felony and upon conviction thereof shall be fined under title 18, United States Code, or imprisoned for not more than ten years, or both. . (c) Increased civil monetary penalties for certain individuals violating positions of trust Section 1129(a)(1) of the Social Security Act ( 42 U.S.C. 1320a–8(a)(1) ) is amended, in the matter following subparagraph (C), by inserting after withholding disclosure of such fact the following: , except that in the case of such a person who receives a fee or other income for services performed in connection with any such determination (including a claimant representative, translator, or current or former employee of the Social Security Administration) or who is a physician or other health care provider who submits, or causes the submission of, medical or other evidence in connection with any such determination, the amount of such penalty shall be not more than $7,500 . (d) Establishment of sanctions for violations by claimant representatives Section 206(a)(1) of the Social Security Act ( 42 U.S.C. 406(a)(1) ) is amended by inserting after or who violates any provision of this section for which a penalty is prescribed. the following: The Commissioner of Social Security shall establish rules under which fines and other sanctions the Commissioner determines to be appropriate may be imposed and collected for failure to comply with the Commissioner's rules and regulations. . (e) Civil monetary penalty on claimant representatives Section 1129(a) of the Social Security Act ( 42 U.S.C. 1320a–8(a) ) is amended by adding at the end the following: (4) Any person (including an organization, agency, or other entity) who, while acting as a claimant representative pursuant to section 206, knowingly charges, demands, receives, or collects for services rendered in excess of the maximum fee prescribed by the Commissioner of Social Security or allowed by a court in connection with proceedings before the court to which section 206(b)(1) is applicable, shall be subject to, in addition to any other penalties that may be prescribed by law, a civil monetary penalty of not more than $7,500 for each violation. Such person shall also be subject to an assessment, in lieu of damages sustained by the United States resulting from the improper payment, of not more than twice the amount of any payments so received. . (f) Inflation adjustment of certain civil monetary penalties Title XI of the Social Security Act ( 42 U.S.C. 1301 et seq. ) is amended by inserting after section 1129B the following: 1129C. Civil monetary penalty inflation adjustment (a) Adjustment by regulation The Commissioner of Social Security shall, not later than 180 days after the date of enactment of the Disability Fraud Reduction and Unethical Deception (FRAUD) Prevention Act, and at least once every 4 years thereafter— (1) by regulation adjust the maximum amount of each civil monetary penalty by the inflation adjustment described under subsection (b); and (2) publish each such regulation in the Federal Register. (b) Amount of adjustment The inflation adjustment under subsection (a) shall be determined by increasing the maximum amount of each civil monetary penalty by the cost-of-living adjustment. Any increase determined under this subsection shall be rounded to the nearest— (1) multiple of $1,000 in the case of penalties greater than $1,000 but less than or equal to $10,000; and (2) multiple of $5,000 in the case of penalties greater than $10,000 but less than or equal to $100,000. (c) Definitions For purposes of this section— (1) the term civil monetary penalty means— (A) a penalty imposed by paragraph (1), (3), or (4) of section 1129(a); and (B) a penalty imposed by paragraph (1) or (2) of section 1140(b); and (2) the term cost-of-living adjustment means the percentage (if any) for each civil monetary penalty by which— (A) the Consumer Price Index for all Urban Consumers (CPI–U) for the month of June of the calendar year preceding the adjustment, exceeds (B) the CPI–U for the month of June of the calendar year in which the amount of such civil monetary penalty was last set or adjusted pursuant to law. (d) Application of increase Any increase under this Act in a civil monetary penalty shall apply only to violations which occur after the date the increase takes effect. . (g) Mandatory restitution in Social Security fraud cases (1) Amendments to title II Section 208(b) of the Social Security Act ( 42 U.S.C. 408(b) ) is amended— (A) in paragraph (1), by striking may order and inserting shall order ; (B) in paragraph (2), by striking 3663 and inserting 3663A ; (C) by striking paragraph (3); and (D) by redesignating paragraphs (4) and (5) as paragraphs (3) and (4), respectively. (2) Amendments to title VIII Section 811(b) of such Act ( 42 U.S.C. 1011(b) ) is amended— (A) in paragraph (1), by striking may order and inserting shall order ; (B) in paragraph (2), by striking 3663 and inserting 3663A ; (C) by striking paragraph (3); and (D) by redesignating paragraph (4) as paragraph (3). (3) Amendments to title XVI Section 1632(b) of such Act ( 42 U.S.C. 1383a(b) ) is amended— (A) in paragraph (1), by striking may order and inserting shall order ; (B) in paragraph (2), by striking 3663 and inserting 3663A ; (C) by striking paragraph (3); and (D) by redesignating paragraph (4) as paragraph (3). (4) Effective date The amendments made by paragraphs (1), (2), and (3) shall apply with respect to violations occurring on or after the date of the enactment of this Act. (h) No benefits payable to individuals for whom a civil monetary penalty is imposed for fraudulently concealing work activity Section 222(c)(5) of the Social Security Act ( 42 U.S.C. 422(c)(5) ) is amended by inserting after conviction by a Federal court the following: , or the imposition of a civil monetary penalty under section 1129, . (i) Improved collection of civil money penalties and assessments Section 1129(e) of the Social Security Act ( 42 U.S.C. 1320a–8 ) is amended— (1) by redesignating paragraphs (1) and (2) as paragraphs (2) and (3), respectively; (2) by inserting before paragraph (2) the following: (1) Civil money penalties and assessments imposed under this section may be compromised by the Commissioner of Social Security. ; and (3) in paragraph (2) (as redesignated by paragraph (1) of this section), by striking Civil money penalties and assessments imposed under this section may be compromised by the Commissioner of Social Security and may be recovered— and inserting To the extent that the Commissioner of Social Security determines to seek recovery of a civil money penalty or assessment imposed under this section, the Commissioner shall promptly seek such recovery— . 4. Review of highest-earning claimant representatives Not later than 1 year after the date of the enactment of this Act and biennially thereafter, the Inspector General of the Social Security Administration shall conduct biennial reviews of the practices of a sample of the highest earning claimant representatives to ensure compliance with the policies of the Social Security Administration.