A 71-year-old retired Tulane University professor named James Hood lives in a federal prison camp in Duluth, and he's not expected to get out until 2016. Hood and his wife were convicted in 2013 of defrauding the federal government of health and disability benefits, despite a net worth estimated at $11 million and a sumptuous home in North Oaks.
Something else makes the Hoods stand out: They represent one of the two recent cases of representative payee fraud prosecuted in Minnesota.
Representative payees, or rep payees, manage the finances for Social Security recipients who are too young or disabled to do so for themselves. It's a massive program desperately in need of greater transparency and accountability, as I wrote last week.
Earlier this year, Social Security's Office of Inspector General - the agency's internal watchdog - informed me that there were 364 convictions for representative payee fraud in fiscal year 2013 and the first half of fiscal year 2014. Of those, only two were in Minnesota. The Hoods stole an estimated $80,000 Supplemental Security Income, not to mention $400,000 in other state and federal, for their children by lying about their assets, according to prosecutors. Cynthia Hood was spared prison time because a judge wanted her to be able to care for the children.
The other case was Dora White, a northern Minnesota woman who was sentenced in June 2013 to a year in prison after stealing nearly $30,000 in SSI payments from 2007 to 2011. According to the Inspector General, "White was the rep payee for her child that was not in her custody (the child was in foster care). White used the SSA funds intended for her child for her own use." The federal Bureau of Prisons web site lists her location as a residential re-entry center in Minneapolis.
Provided my FOIA requests come through, I'll be delving more into the issue of rep payees in the months ahead.