Personal Injury Attorneys in Indianapolis

Social Security Ordered To Pay More Than $500 Million

Nearly $500 million in social security benefits will be paid to 80,000-plus recipients who were unfairly denied because of a glitch in a federal computer program that was designed to catch criminals.

Federal Judge Claudia Wilken approved a tentative settlement requiring that the Administration pay recipients who were wrongly "flagged" as criminals, and who have been denied benefits since Jan 1, 2007. (A 1996 law prohibited criminals with warrants from receiving federal benefits. Once this law went into effect, the federal database was designed to "flag" criminals who were collecting benefits.) More than 120,000 people who applied are eligible to reapply for benefits.

The tentative agreement was reached after the Social Security Administration was challenged by a class-action lawsuit, Martinez v. Astrue. The lawsuit stated that Rosa Martinez, 52, of Redwood City, California, was denied $870 of her monthly disability benefits because the system believed that she had an outstanding drug warrant. After the allegation was investigated, it was determined that there was indeed a warrant for a Rosa Martinez, but not the Rosa Martinez of California.  The Rosa Martinez with the drug warrant resided in Miami, Florida.  Ms. Martinez or California knew that she was innocent, and tried to prove such innocence, but failed.

Over the past several years, numerous district court judges across the country have ruled in favor of the victims in their individual cases. The determined that stopping coverage based on the database searches was unlawful. In 2005, a federal appeals court in New York ruled the database search illegal. The Social Security Administration stopped this practice in New York, Connecticut and Vermont. As of April 1st, the warrant checking process will no longer be allowed.

A spokesman for the Social Security Administration declined a comment until the settlement is finalized later this year. The Social Security Administration pays benefits to more than 356,000 local households.

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