Government Stops Unlawful Social Security Suspensions; Agrees to Repay More Than Half a Billion in Back Benefits

/PRNewswire/ -- The Social Security Administration has agreed to repay more than $500 million in benefits that were unlawfully withheld from 80,000 people since January 2007. The agreement is part of a class action settlement preliminarily approved by U.S. District Court Judge Claudia Wilken today. In addition, people whose benefits were suspended or denied between 2000 and 2006 will be notified of the new policy and invited to re-establish eligibility. All told, more than 200,000 people may have benefits reinstated and/or receive back payments through the settlement. All beneficiaries must continue to be eligible to receive payments.

The settlement resolves a lawsuit, Martinez v. Astrue, challenging SSA's method of implementing a provision of the Social Security Act. The law seeks to prevent people from using government benefits to flee from arrest. Rather than trying to determine which Social Security recipients were actually fleeing prosecution, SSA used an automated system that matched names in warrant databases to those at SSA. Many of the automatic benefit suspensions involved false or unproven allegations, minor infractions or long-dormant arrest warrants. Although regulations provide for an appeal process, individuals losing benefits were routinely informed by SSA staff that they could not appeal.

Under the agreement, SSA has stopped, as of April 1, 2009, suspending or denying benefits due to the mere existence of a warrant - unless the warrant is issued in a criminal proceeding on a charge such as flight or escape.

"The vast majority of class members were not fleeing at all; many never knew that criminal charges were pending against them, let alone that a warrant had been issued," Gerald McIntyre, attorney with the National Senior Citizens Law Center, said.

In addition to granting preliminary approval of the settlement agreement, Judge Wilken ordered a final fairness hearing to be held on September 24. At that hearing, Judge Wilken will hear any objections from class members and determine whether to approve the agreement, which will not take full effect until the appeal time has run.

The plaintiffs in the case are represented by the National Senior Citizens Law Center, pro bono counsel from the law firm of Munger, Tolles & Olson, the Mental Health Project of the Urban Justice Center, Disability Rights California, and the Legal Aid Society of San Mateo County.

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