South Carolina Man Sentenced to 41 Months in Prison for $1.5 Million Veterans Affairs and Social Security Disability Fraud

Columbia, South Carolina – Dennis Paulsen, age 45, of Blythewood, was sentenced today in U.S. District Court, District of South Carolina, to 41 months incarceration, three years supervised release, and ordered restitution of $1.5 million to the Department of Veterans Affairs (VA)  and $133,000 to the Social Security Administation (SSA). Paulsen was sentenced based on his conviction at trial in January for theft of government funds.

In conducting one of the largest fraudulent single disability compensation claims in VA history, Paulsen substantially feigned and exaggerated the impairment resulting from his multiple sclerosis (MS) diagnosis.  After being diagnosed and discharged from the Navy in the early 1990s, Paulsen began receiving a monthly VA benefit as a result of his diagnosis.  Unsatisfied with the amount he was receiving, Paulsen began a pattern of malingering by claiming his MS rendered him unable to use his hands or feet in any respect.  Still unhappy with the money he was awarded, Paulsen ramped up his claims, lying to his doctors, presenting himself as house- and wheelchair- bound, and making false claims that he required daily professional medical care to live until his benefits were increased to the maximum disability payments available to a Veteran. 

At the same time, Paulsen used the same feigned impairments to convince SSA that he was entitled to Social Security disability benefits.  Despite his feigned claims of impairments and presenting himself in a wheelchair to his doctors, Paulsen lived in a non-handicap accessible residence and was able to ride his motorcycle and jet skis plus play baseball and golf on a regular basis.  In 1999, Paulsen met his ex-wife at the gym where he exercised and worked training others.  In 2004, Paulsen sold their 5,000-square-foot house for more than half of a million dollars and moved from Virginia to Blythewood.

In Blythewood, Paulsen purchased a two-story brick house that was not handicapped accessible and stopped going to neurologists for his MS.  Illustrating his lack of impairment, Paulsen was active in several gyms, joined a baseball league from 2006 until 2014, and lived an active lifestyle, including playing pool, swimming in his backyard pool, playing on the beach, and driving his Escalade and manual shift Mini-Cooper. In 2014, a concerned citizen reported Paulsen to the VA and explained how Paulsen lacked the impairments that he claimed. Upon learning that the VA was looking into his actual impairment from MS, Paulsen immediately quit his baseball league and began appearing at the VA again in his wheelchair, claiming to be unable to walk or use his hands.       

The extensive investigation by the VA and SSA included undercover agents, surveillance, and photographs and video footage from banks, stores, and the Columbia Metropolitan Airport. Family photographs kept by Paulsen’s ex-wife were also obtained showing Paulsen’s many activities with his family, playing baseball, and participating in a Marine Mud Run. Paulsen testified, in a wheelchair, for four hours and called three doctors as expert witnesses in an attempt to support his claim that he was and had been totally disabled. The guilty verdict reflected that the jury did not find this testimony credible.

The case was investigated by the Office of Inspector General for Veterans Affairs and the Social Security Administration. Assistant United States Attorneys William E. Day II and Jay N. Richardson of the Columbia office prosecuted the case.Columbia, South Carolina – Dennis Paulsen, age 45, of Blythewood, was sentenced today in U.S. District Court, District of South Carolina, to 41 months incarceration, three years supervised release, and ordered restitution of $1.5 million to the Department of Veterans Affairs (VA)  and $133,000 to the Social Security Administation (SSA). Paulsen was sentenced based on his conviction at trial in January for theft of government funds.

In conducting one of the largest fraudulent single disability compensation claims in VA history, Paulsen substantially feigned and exaggerated the impairment resulting from his multiple sclerosis (MS) diagnosis.  After being diagnosed and discharged from the Navy in the early 1990s, Paulsen began receiving a monthly VA benefit as a result of his diagnosis.  Unsatisfied with the amount he was receiving, Paulsen began a pattern of malingering by claiming his MS rendered him unable to use his hands or feet in any respect.  Still unhappy with the money he was awarded, Paulsen ramped up his claims, lying to his doctors, presenting himself as house- and wheelchair- bound, and making false claims that he required daily professional medical care to live until his benefits were increased to the maximum disability payments available to a Veteran. 

At the same time, Paulsen used the same feigned impairments to convince SSA that he was entitled to Social Security disability benefits.  Despite his feigned claims of impairments and presenting himself in a wheelchair to his doctors, Paulsen lived in a non-handicap accessible residence and was able to ride his motorcycle and jet skis plus play baseball and golf on a regular basis.  In 1999, Paulsen met his ex-wife at the gym where he exercised and worked training others.  In 2004, Paulsen sold their 5,000-square-foot house for more than half of a million dollars and moved from Virginia to Blythewood.

In Blythewood, Paulsen purchased a two-story brick house that was not handicapped accessible and stopped going to neurologists for his MS.  Illustrating his lack of impairment, Paulsen was active in several gyms, joined a baseball league from 2006 until 2014, and lived an active lifestyle, including playing pool, swimming in his backyard pool, playing on the beach, and driving his Escalade and manual shift Mini-Cooper. In 2014, a concerned citizen reported Paulsen to the VA and explained how Paulsen lacked the impairments that he claimed. Upon learning that the VA was looking into his actual impairment from MS, Paulsen immediately quit his baseball league and began appearing at the VA again in his wheelchair, claiming to be unable to walk or use his hands.       

The extensive investigation by the VA and SSA included undercover agents, surveillance, and photographs and video footage from banks, stores, and the Columbia Metropolitan Airport. Family photographs kept by Paulsen’s ex-wife were also obtained showing Paulsen’s many activities with his family, playing baseball, and participating in a Marine Mud Run. Paulsen testified, in a wheelchair, for four hours and called three doctors as expert witnesses in an attempt to support his claim that he was and had been totally disabled. The guilty verdict reflected that the jury did not find this testimony credible.

The case was investigated by the Office of Inspector General for Veterans Affairs and the Social Security Administration. Assistant United States Attorneys William E. Day II and Jay N. Richardson of the Columbia office prosecuted the case.