Maine Couple Gets Caught Gaming the Social Services System

17542382 - u s income tax return forms 1040,1065,1120

A Maine couple was recently sentenced in federal court to five years of probation and ordered to pay restitution the federal government for fraudulently receiving more than $119,000 in social services benefits, according to a story from the Bangor Daily News.

The couple, William and Linda Stella, was married the late 1980s and divorced in 2002 and separated for a brief period of time. However, prosecutors alleged that the divorce was a sham, which allowed the two to take advantage of Social Security, housing and Supplemental Nutrition Assistance Program (SNAP) benefits. According to the article, the couple reunited in 2003 and lived in federally subsidized housing. Once the couple reunited, the couple was obligated to tell agencies that their incomes had changed.

The conspiracy began to unravel when the couple’s landlord became suspicious that they were lying about their income because the couple recently purchased a new vehicle and two new scooters. (Fraudsters love fancy wheels.) The landlord contacted the Social Security Administration (SSA) to learn about their income. Then, William Stella complained that his wife’s privacy rights were being violated because the SSA ”should not have given information about the benefits she received to the landlord.” (He liked the money, but hated the idea of anyone knowing about it.) An investigation revealed that her rights were not violated.

The investigation led to charges being filed against the two and investigators determined that the couple had fraudulently received over $119,000 in government benefits over a six year period. (That’s $1,650 per month for six years. Not bad when you can get it.) Their defense attorney argued for sentencing via probation due to the couple’s poor health. (They have good healthcare in jail.)

The larger question is…why did they get away with it for so long? For six years, they played the system and were only caught due to a concerned citizen raising questions – not the agencies that were paying them government benefits. Agencies must do a better job of verifying the eligibility of their benefit recipients, or we all pay the price.

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”Couple gets probation, ordered to pay $119,000 in government benefits fraud,” by Judy Harrison, published by Bangor Daily News, November 23, 2011.

PORTLAND, Maine — A South Paris couple was sentenced Monday in U.S. District Court to five years of probation for fraudulently receiving more than $119,000 in government benefits.

William Stella, 58, and Linda Stella, 68, waived indictment and pleaded guilty in May to conspiracy to defraud the government between October 2002 and December 2008.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.