Sandra D. Smith has been arraigned on federal charges of wire fraud and theft of government funds. The indictment alleges that Smith stole more than $450,000 in Social Security Administration (SSA) retirement benefits and New York State Local and Retirement System (NYSLRS) benefits intended for M.S., who died in 2006 and was no longer eligible to receive those funds.
“Smith allegedly stole money that taxpayers and government employees faithfully paid into these retirement systems and to which she was not entitled,” said U.S. Attorney Ryan K. Buchanan. “This joint investigative effort is another excellent example of how collaboration between federal and state investigative partners help to uncover benefits fraud.”
“For nearly 15 years, the beneficiary’s death was allegedly concealed by Smith so that she could illegally obtain Social Security benefits, which is a federal crime. These charges exemplify that my office will continue to pursue those who defraud the Social Security Administration,” said Gail S. Ennis, Inspector General for the SSA. “I thank the New York Office of the State Comptroller for investigating with us.”
“The defendant callously took advantage of her mother-in-law’s death to profit at the expense of New York’s retirement system and the Social Security Administration,” said New York State Comptroller Thomas P. DiNapoli, who is trustee of the New York State Common Retirement Fund. “She has now been brought to justice and we will seek full restitution. I thank U.S. Attorney Buchanan and the Social Security Administration Office of the Inspector General for their partnership on this matter.”
According to U.S. Attorney Buchanan, the charges, and other information presented in court: In approximately September 2005, M.S., Smith’s former mother-in-law, began receiving SSA and NYSLRS benefits directly deposited into a bank account that was solely in M.S.’s name. At the time of M.S.’s death in September 2006, Smith served as her caretaker and handled her finances. Smith had access to M.S.’s bank account as M.S.’s caretaker.
After M.S. died, neither Smith nor anyone else notified SSA or NYSLRS of M.S.’s passing. Nor did Smith close M.S.’s bank account. Instead, Smith kept M.S.’s bank account open into which SSA and NYSLRS continued to deposit funds until early 2021. Smith knew exactly when those monthly benefits were deposited, and each month she allegedly withdrew the funds from the account almost as soon as they were deposited.
In total, SSA deposited $194,351.00 and NYSLRS deposited $264,699.53 into the account. Smith, who was interviewed in connection with this investigation, admitted that she stole the money and that she knew that she was not entitled to the funds.
Sandra D. Smith, 49, of Morrow, Georgia, was arraigned before U.S. Magistrate Judge Justin S. Anand. Smith was charged with 20 counts of wire fraud in violation of Title 18, United States Code, Section 1343, and 10 counts of theft of government funds in violation of Title 18, United States Code, Section 641. Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.
This case is being investigated by the Social Security Administration - Office of the Inspector General and New York Office of the State Comptroller.
Special Assistant U.S. Attorney Diane C. Schulman is prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
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