Washington Woman Sentenced for Social Security Fraud

From the U.S. Attorney’s Office, Western District of Washington:

A former executive recruiter for Amazon.com was sentenced today in U.S. District Court in Tacoma to one month in prison and three years of supervised release for Social Security fraud, announced Acting United States Attorney Annette L. Hayes. Between 2009 and 2012, MARLENE SCOTT, 42, concealed the fact that her mother and sister, who were welfare recipients, had moved from the United States to Lebanon and therefore were no longer entitled to collect welfare benefits in this country. SCOTT falsely told caseworkers that her mother and sister lived with her in the Magnolia neighborhood of Seattle. By hiding her mother and sister’s departure, defendant caused the Social Security Administration to pay out more than $50,000 in benefits, which Scott then withdrew. U.S. District Judge Ronald B. Leighton noted that SCOTT took the witness stand and lied when the case went to trial in June 2014. The judge declared a mistrial after the jury was unable to reach a unanimous verdict. Judge Leighton said the story SCOTT told on the witness stand was “preposterous.” Judge Leighton said Scott’s lies on the witness stand “were a profound offense to the legal system,” and, but for the false testimony, he might have given her a probationary sentence.

According to records filed in the case, SCOTT’s mother and sister moved to Lebanon in June 2009. The following year the women visited Scott in Seattle. They opened bank accounts in Magnolia and had their welfare payments deposited into those accounts. SCOTT repeatedly accessed the benefits by using her mother’s debit card or by forging her mother’s signature. During the 2010 visit, SCOTT called Social Security and claimed her mother was living in her home and SCOTT was charging her mother fair market rent. SCOTT forged her mother’s signature on forms and lied to Social Security personal when they called asking to speak to SCOTT’s mother. When investigators visited her home, SCOTT claimed her mother was visiting her sister and brother in North Carolina and provided a non-working phone number. SCOTT knew at the time that no one in her family remained in North Carolina since her brother had moved from there to Lebanon in 2003.

After the jury failed to return a verdict, SCOTT pleaded guilty on July 25, 2014. In accordance with the plea she repaid $50,973 to the government.

As prosecutors pointed out in their sentencing memorandum, those who defraud Social Security are stealing from the very poorest and most vulnerable Americans. Worse, fraud on the welfare system corrodes the trust required to maintain programs that provide a lifeline of last resort for the poor. Taxpayers contribute to SSI based on trust that the funds will be used to support others in real need. When someone like SCOTT, an Amazon professional, intentionally exploits that trust through fraud, the result is public cynicism, which further undermines these programs. The true victims of this offense are those genuinely in need.

In choosing to impose a prison term instead of home confinement, Judge Leighton said the prison time is “important as a message. This institution, the judiciary, cannot and will not knowingly tolerate perjury.”

The case was investigated by the Social Security Administration Office of Inspector General (SSA-OIG). The case was prosecuted by Assistant United States Attorneys Seth Wilkinson and Kate Crisham.

A former executive recruiter for Amazon.com was sentenced today in U.S. District Court in Tacoma to one month in prison and three years of supervised release for Social Security fraud, announced Acting United States Attorney Annette L. Hayes. Between 2009 and 2012, MARLENE SCOTT, 42, concealed the fact that her mother and sister, who were welfare recipients, had moved from the United States to Lebanon and therefore were no longer entitled to collect welfare benefits in this country. SCOTT falsely told caseworkers that her mother and sister lived with her in the Magnolia neighborhood of Seattle. By hiding her mother and sister’s departure, defendant caused the Social Security Administration to pay out more than $50,000 in benefits, which Scott then withdrew. U.S. District Judge Ronald B. Leighton noted that SCOTT took the witness stand and lied when the case went to trial in June 2014. The judge declared a mistrial after the jury was unable to reach a unanimous verdict. Judge Leighton said the story SCOTT told on the witness stand was “preposterous.” Judge Leighton said Scott’s lies on the witness stand “were a profound offense to the legal system,” and, but for the false testimony, he might have given her a probationary sentence.

According to records filed in the case, SCOTT’s mother and sister moved to Lebanon in June 2009. The following year the women visited Scott in Seattle. They opened bank accounts in Magnolia and had their welfare payments deposited into those accounts. SCOTT repeatedly accessed the benefits by using her mother’s debit card or by forging her mother’s signature. During the 2010 visit, SCOTT called Social Security and claimed her mother was living in her home and SCOTT was charging her mother fair market rent. SCOTT forged her mother’s signature on forms and lied to Social Security personal when they called asking to speak to SCOTT’s mother. When investigators visited her home, SCOTT claimed her mother was visiting her sister and brother in North Carolina and provided a non-working phone number. SCOTT knew at the time that no one in her family remained in North Carolina since her brother had moved from there to Lebanon in 2003.

After the jury failed to return a verdict, SCOTT pleaded guilty on July 25, 2014. In accordance with the plea she repaid $50,973 to the government.

As prosecutors pointed out in their sentencing memorandum, those who defraud Social Security are stealing from the very poorest and most vulnerable Americans. Worse, fraud on the welfare system corrodes the trust required to maintain programs that provide a lifeline of last resort for the poor. Taxpayers contribute to SSI based on trust that the funds will be used to support others in real need. When someone like SCOTT, an Amazon professional, intentionally exploits that trust through fraud, the result is public cynicism, which further undermines these programs. The true victims of this offense are those genuinely in need.

In choosing to impose a prison term instead of home confinement, Judge Leighton said the prison time is “important as a message. This institution, the judiciary, cannot and will not knowingly tolerate perjury.”

The case was investigated by the Social Security Administration Office of Inspector General (SSA-OIG). The case was prosecuted by Assistant United States Attorneys Seth Wilkinson and Kate Crisham.