Attorney Pleads Guilty in $550M Disability Benefits Theft

The Kentucky attorney who called himself “Mr. Social Security” pleaded guilty to charges of theft of government money and payments to a federal judge for his role in defrauding the Social Security Administration (SSA).  On March 24, Eric C. Conn admitted to working with doctors and an administrative law judge to procure $550 million in Social Security Disability Insurance (SSDI) benefits for clients who may not have been disabled. 

As we’ve previously reported, attorney Conn built the third-largest disability benefits practice in the United States out of his tiny eastern Kentucky town of Pikeville.  The Wall Street Journal reported that he made $3.8 million from disability appeals in 2010 alone.  Under federal law, an attorney is entitled to a portion of an applicant's past-due benefits if the applicant wins an appeal. Conn came under investigation when whistleblowers claimed that he was scheming with administrative law judge David Daughterty to approve appeals and split the fees. 

In his plea, attorney Conn admitted to working with a team of doctors to submit fraudulent medical evidence to the SSA in support of his clients' disability applications.  Once the applications were initially rejected, attorney Conn paid Daugherty about $10,000 a month to approve the applications on appeal.  He admitted to using this scheme for more than 1,700 successful disability appeals that were granted by Daugherty.

Attorney Conn admitted that he received more than $5.7 million in fees from the SSA for his representation in the fraudulent claims.  According to press reports, he agreed to repay that amount to the SSA plus the $46.5 million that has already been paid out to claimants because of the fraud. 

In fallout from the case, the SSA held redetermination hearings for about 1,500 beneficiaries.  The press reports that fewer than half -- around 700 -- could keep their benefits.  Attorney Conn will be sentenced on July 14, 2017, when he faces up to 12 years in prison.  Daugherty and a psychologist, Alfred Adkins, who allegedly signed false mental-impairment evaluations, have also been charged and are awaiting trial.

To read more about this case, click here and here.