Five people, including a Social Security Administration employee, are facing federal charges for a kickback scheme involving $1.9 million in fraudulent benefits.
Jayson Cruz, 39, worked as a benefits authorizer at the administration’s Great Lakes Program Service Center in Chicago at the time of the alleged fraud between 2009 and 2013, prosecutors said.
He and four other people were charged in a June 30 indictment that was unsealed Wednesday after their arrests, according to the U.S. attorney’s office.
According to the indictment, Cruz was responsible for authorizing monthly old-age, survivors and disability insurance benefits to beneficiaries and their families.
Cruz — along with co-defendants Monica Knox-Sumrell, Vonzell White, Michael Elarde and Jerry Brown Jr. — recruited recipients to receive additional payments on top of what they were owed, authorities claim.
Prosecutors also claim Knox-Sumrell also falsely told recipients that she worked for the Social Security Administration.
Cruz authorized the extra, fraudulent payments, taking care to keep the amounts below a $6,000 threshold that would have required a supervisor’s approval, the indictment said.
His four co-defendants later collected the majority of the money back from the people they recruited, the indictment claims.
Cruz also fraudulently authorized payments to White, Elarde, Brown and others by falsely portraying them as representatives of deceased beneficiaries who were owned money from the administration, according to the indictment.
The Social Security Administration ultimately paid out $1.9 million in fraudulent benefits to more than 150 people because of the scheme, authorities said.
The investigation is still ongoing, authorities said.
Cruz was charged with 10 counts of wire fraud, while the other four defendants are charged with two counts each of wire fraud, the U.S. attorney’s office said. All five are from Chicago, and were released on their own recognizance after pleading not guilty during arraignments Wednesday.
The indictment seeks the forfeiture of more then $1.9 million and a residence in Chicago, federal authorities said.
Each count of wire fraud carries a maximum sentence of 20 years in prison, a $250,000 fine and mandatory restitution. They are next scheduled to appear in court for a status hearing Sept. 16.
