Port Tobacco Man Pleads Guilty to Fraudulently Obtaining $636,000 in Disability Payments

Defendant Collected Unwarranted Disability Benefits for 26 Years

GREENBELT, Md. (Sept. 7, 2010)—John Hanson, age 63, of Port Tobacco, Maryland, pleaded guilty on Sept. 1 to making a false statement to fraudulently obtain $636,410 in federal disability payments over the course of 26 years. As part of his plea agreement, Hanson has agreed to pay $400,123 in restitution, which sum represents all of the funds from his federal retirement account and $72,000 seized by the government in September 2009 during the execution of search warrants.

The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Robert Panella of the Department of Labor - Office of Inspector General; and Supervisory Special Agent Patrick Gookin of the Defense Logistics Agency - Accountability Office.

“Sham disability claims by government employees are an insult to honest taxpayers who foot the bill,” said U.S. Attorney Rod J. Rosenstein. “John Hansen was approved for permanent disability benefits at age 31. He was not permanently disabled by age 36, but he deceived his doctors and lied to his government so he could continue to collect for another 26 years.”

Supervisory Special Agent Patrick Gookin stated, “The DLA Accountability Office’s partnership with the U.S. Department of Labor OIG in this pro-active, multi-year investigation, proved effective in stopping a fraud that pilfered over $600,000.”

According to Hanson’s guilty plea, Hanson was a printer for the Defense Logistics Agency. On November 22, 1978, Hanson reported an on-the-job back injury. Based on reports of a treating physician that Hanson provided, Hanson was classified as permanently disabled and declared to be entitled to worker’s compensation.

In order to qualify for worker’s compensation, Hanson was required to regularly submit a form which specifically asked whether he was employed or self-employed for the past 15 months, as any additional income could reduce compensation entitlement or disqualify him from entitlement altogether. From at least 1983 through 2009, Hanson answered no to these questions. In fact, during this time period, Hanson completely disassembled and refurbished vehicles located in his garage, driveway and detached garage, and engaged in home remodeling and construction work in return for pay. He was observed by federal agents demolishing a porch attached to his residence and replacing it with a glass “Florida Room.” He also built a multi-car garage attached to his residence. Hanson also sometimes wore braces to his doctor’s office so as to deceive his doctor into believing he could not perform physical labor.

Between 1983 and 2009, Hanson was paid at least $636,410.38 in disability benefits to which he was not entitled.

Hanson faces a maximum sentence of five years in prison and a $250,000 fine. U.S. District Judge Roger W. Titus scheduled sentencing for December 13, 2010 at 3:00 p.m.

United States Attorney Rod J. Rosenstein commended the Department of Labor - Office of Inspector General and the Defense Logistics Agency - Accountability Office for their assistance in the investigation. Mr. Rosenstein thanked Assistant United States David I. Salem, who is prosecuting the case.

Source: United States Attorney's Office for the District of Maryland

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