About 2,000 additional former clients of attorney Eric C. Conn will have to prove they still deserve federal disability benefits in coming months, creating the potential for more economic hardship in Eastern Kentucky, according to people familiar with the government’s plan.
The Social Security Administration (SSA) plans to notify nearly 2,000 former clients of Conn that it will hold hearings to re-determine if they are eligible to continue receiving disability checks, according to Prestonsburg attorney Ned Pillersdorf.
The agency previously moved in May 2015 to begin re-determining whether 1,500 former Conn clients could keep benefits because of a suspicion that Conn used fraudulent evidence in their claims.
Social Security denied benefits for many of the people involved in the first round of hearings, said Pillersdorf, who helped lead an effort to find lawyers for the first 1,500 clients.
He took part in a call Friday in which Social Security officials outlined the plan for another wave of hearings.
U.S. Rep. Hal Rogers, a Republican who represents Eastern and Southern Kentucky, confirmed Social Security notified his office of the decision to re-determine eligibility for nearly 2,000 former Conn clients.
“It is heartbreaking to witness the tragic impact that Eric C. Conn’s fraud scheme continues to have on the lives of people living in Eastern Kentucky, who had entrusted him with this vital source of income,” Rogers said.
The people who lost eligibility in the first round of re-determination hearings can appeal, but the move by Social Security to review the eligibility of 2,000 more people raises the potential that hundreds more will lose benefits in an area where disability payments contribute significantly to the economy.
Not all 2,000 people will be notified at the same time of the need for a hearing, but the government has lined up extra judges to do the re-determinations, Pillersdorf said.
“It’s beyond cruel what they’re doing,” Pillersdorf said. “This is going to hit this area like a nuclear bomb.”
Former clients of Conn involved in the first round of re-determination hearings are challenging the agency’s right to review their eligibility on several grounds, including that the agency didn’t act quickly enough and that the process is not fair because they can’t challenge the evidence against them.
That case is pending. It is premature and arrogant for Social Security to embark on a new wave of re-determinations before a decision, Pillersdorf said.
Rogers also said he questioned the need for the additional hearings while that litigation is pending.
Rogers said he asked Social Security officials to continue payments to the nearly 2,000 beneficiaries during the process of making a new decision on their eligibility, and was pleased the agency said it will do so.
When the agency notified the first batch of former Conn clients that it would re-determine their eligibility, it also said it would stop their checks during the process, ending the only income many had.
At least two people in Eastern Kentucky committed suicide after getting the notices.
Rogers interceded with Social Security at the time and got the agency to keep benefits in place during the re-determination process.
The agency plans to undertake the eligibility reviews because Conn included fraudulent information in claims he submitted for clients.
Conn, 57, was once one of the most prolific disability attorneys in the nation, representing thousands of people in successful claims for benefits before pleading guilty in March 2017 to stealing fees from Social Security and bribing an agency judge.
Conn admitted taking part in a massive, years-long conspiracy in which he put false evidence of clients’ physical or mental disabilities in their claims, paid doctors to sign forms with little scrutiny, and gave cash to the judge to approve claims.
David B. Daugherty, a former Social Security judge, admitted taking $609,000 in bribes from Conn, and Alfred Bradley Adkins, a psychologist from Pikeville, was convicted of signing forms for Conn that included false information, as well as conspiracy and mail fraud.
In addition, another former Social Security supervisory judge, Charlie Paul Andrus, admitted taking part in retaliating against a whistleblower in the agency.
Conn is serving a 12-year sentence. Daugherty was sentenced to four years in prison and Adkins to 25.
Conn also faces fraud and other charges left from the initial case against him, as well as charges that he absconded from home detention while awaiting sentencing last year.
Conn is charged with fleeing to Mexico and ultimately to Honduras, where authorities arrested him Dec. 2 after six months on the run.
The Social Security Administration has said it is required to make a new determination of a person’s eligibility for disability benefits when it suspects that fraud was involved in the earlier application.
The fact that the agency plans to review thousands of additional people Conn represented would indicate it suspects fraud in far more cases than it did in 2015.
Social Security officials said during the call Friday that they identified 1,000 cases for review based on continued investigation of earlier information, but identified the other 1,000 based on new information, Pillersdorf said.
Conn has alleged to the Herald-Leader that other people were involved in fraudulent conduct besides those that have been charged in the case so far.
Former clients of Conn have said in a lawsuit that there is no evidence they knew about or took part in alleged fraud.