A federal probe into phone-based fraud at the Social Security Administration (SSA) has uncovered just two potentially fraudulent claims out of more than 110,000—undermining months of political rhetoric alleging widespread fraud.
Anti-fraud measures backfire at SSA
The anti-fraud protocol, launched in April by the Department of Government Efficiency (DOGE), required a three-day hold on all phone-based benefit claims. The policy caused a 25% slowdown in processing retirement claims, leading to a backlog of over 140,000 cases pending for more than 60 days, according to an internal SSA memo obtained by Nextgov/FCW.
“No significant fraud has been detected from the flagged cases,” the document said.
Despite the delays, the actual fraud detection rate was just 0.0018%—two out of 110,000 calls. Fewer than 1% of claims were even flagged as potentially fraudulent.
What sparked the crackdown?
The crackdown followed a March 27 Fox News segment in which DOGE engineer Aram Moghaddassi incorrectly claimed that 40% of SSA calls to change direct deposit information were from fraudsters. In fact, 40% of the agency’s direct deposit fraud is linked to phone calls—not that 40% of the calls themselves are fraudulent.
The misinformation spread quickly, echoed by Vice President J.D. Vance and former DOGE chief Elon Musk. The SSA responded by temporarily banning all phone-based account changes, later narrowing restrictions to retirement and survivor claims. Eventually, SSA restored access while continuing backend fraud screening using tools like Transunion and PinDrop.
Policy impact and political backlash
The internal memo labeled the outcome a “degradation of public service.” The required in-person verification for flagged phone claims drew criticism from experts and lawmakers alike.
Sen. Elizabeth Warren called the crackdown “a backdoor cut to people’s benefits,” arguing that misinformation from DOGE has driven harmful policy decisions. She and other lawmakers formed a “Social Security War Room” to push back against changes they say undermine access to earned benefits.
Kathleen Romig, director of Social Security and disability policy at the Center on Budget and Policy Priorities, echoed those concerns. “So many of these policy changes … seem to have been fueled by misinformation from people like Elon Musk,” she said.
Direct deposit security remains tight
SSA still requires users to verify their identity online with a one-time code before making direct deposit changes by phone. Otherwise, they must visit an SSA office in person—a burden for millions who live far from local branches.
Despite the low fraud rate, SSA leadership continues to evaluate the policy’s future. Internal sources say the three-day hold may be removed, and broader reforms to identity proofing are under consideration.
Meanwhile, a senior SSA advisor stated the agency blocked 20,000 fraudulent attempts across all platforms—web and phone—over the past month. But those figures encompass all transaction types, not just phone claims.
Key takeaways
- Only 2 of 110,000 phone claims at SSA were flagged as likely fraudulent.
- Policy caused 25% delays in retirement claims, adding to backlogs.
- Misleading claims about fraud rates led to policy overcorrections.
- Phone-based direct deposit changes still require online verification.
- SSA is reviewing and may revise anti-fraud protocols in the coming weeks.
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