DOGE Social Security plan targets small fraud at possible high cost
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In less than two weeks Social Security is set to enact major changes that threaten to upend services for many Americans, in order to fight fraud that amounts to a fraction of 1% of the agency's spending.
Why it matters: Social Security Administration veterans and powerful lobbying groups warn the changes, made at breakneck speed, may even foment more swindling.
- The agency's internal documents caution the changes will effectively cut some Americans off from receiving benefits.
- Former officials say the changes will overwhelm the agency's already stretched resources, with staffing at a record low and America's aging population rapidly rising.
Catch up quick: At a press conference on Tuesday, acting commissioner Lee Dudek said $100 million is lost each year to direct deposit fraud. To address it, the agency is curtailing its phone services.
- Effective March 31, Americans won't be able to call and sign up for Social Security benefits, or make major changes to their accounts that require ID verification.
- They either must use the internet or visit a field office, not an easy option for many of the people who most rely on Social Security.
By the numbers: $100 million in fraud represents about 0.00625% of the $1.6 trillion the government sends out each year in Social Security benefits.
- Only around half of that $100 million was lost to phone fraud in 2024, according to a person familiar with Social Security fraud who attended a meeting last year where data on the issue was shared, speaking on the condition of anonymity out of fear of retaliation.
Zoom out: Social Security usually moves deliberately, taking months or even years to make big changes, says Bill Sweeney, vice president for government affairs at AARP, which represents nearly 38 million older Americans.
- More than 800,000 AARP members have reached out to Congress on this issue over the past week, as news of the changes first started leaking out and at the group's urging.
- 62 House members, led by Reps. Jared Moskowitz (D-Fla.) and Al Green (D-Texas), sent a letter to Dudek Wednesday urging him to protect phone services.
- Rep. Greg Landsman (D-Ohio) tells Axios the issue has been coming up a lot with constituents: "People are scared and pissed."
For the record: Neither the Social Security Administration nor the White House returned requests for comment.
Between the lines: There's no time for a public messaging campaign so folks know what's happening, Sweeney says. Instead, people will probably vaguely know changes are coming and hear about a deadline.
- That gives an opportunity for a bad actor to pounce and try to steal bank information and Social Security numbers from seniors by pretending to be a Social Security worker.
- "It is going to absolutely open the door to people committing fraud and hurting older adults, especially those who are most vulnerable," he says.
Plus: Dudek says in an effort to improve customer service, the agency would no longer put a 30-day hold on accounts that change their direct deposit bank information.
- "We put that 30-day hold there to try and limit internet fraud," says Jill Hornick, who's handled calls at a field office in the Chicago suburbs for the past 33 years.
Zoom in: Hornick says she hasn't seen a lot of fraud over the years, but what she does see typically starts on the internet.
- Hornick, an administrative director for AFGE, a union for government workers, usually learns about it when folks call to say they didn't get a check. When she verifies their account information, lo and behold: "They'll say, that's not my bank account." It was changed online.
The bottom line: DOGE is moving fast, and getting closer to breaking a beloved American thing.
Andrew Solender contributed to this report.
