FORT SMITH, Ark. — A couple from Fort Smith, Ark. is heading to federal prison after defrauding the Social Security Administration (SSA) by claiming disability while simultaneously working for a roofing company.
A release from the Department of Justice Western District of Arkansas states Stephen Wayne Schwartz was sentenced to six months in prison followed by three years of supervised release. His wife, Rebekah Jolea Schwartz, received the same sentence. They were charged with Theft of Government Funds and Aiding and Abetting and ordered to pay restitution, jointly and severally, to the SSA in the amount of $167,756.60.
“The Social Security Administration is set up to make funds available to those who are truly in need because of a disability. However, through their criminal conduct, Mr. and Mrs. Schwartz lined their own pockets with this money that was intended to help those with legitimate disabilities,” said U.S. Attorney David Clay Fowlkes.
Court documents say Stephen Schwartz, 55, began receiving SSA Title II disability insurance benefits in 2000. In 2010, the SSA informed him he was no longer entitled to the insurance due to his employment and income. In November 2012, the SSA reinstated his disability insurance payments based in part on his report that he was no longer working.
In 2015, while receiving these payments, he worked as a school bus driver, but didn’t report his earnings or job to the SSA. Once the SSA learned of his employment, it ceased insurance payments. On June 15, 2016, he and his wife, Rebekah Schwartz, 44, submitted a document asking for the reinstatement of his SSA disability insurance payments, claiming his condition prevented him from working. Stephen Schwartz subsequently signed a document filled out by Rebekah Schwartz that claimed he couldn’t “drive a big truck, keep log books, follow map/directions ... carry on a conversation, count, concentrate, [and] follow instructions.”
According to the U.S. Attorney's Office, at the time Stephen Schwartz signed the document, he was working as a driver for a roofing company, counting roofing materials for delivery and pick up and following his employer’s delivery and pick-up instructions. The money he earned was paid to Rebekah Schwartz to hide his income from the SSA. The agency reinstated Stephen Schwartz’s payments in 2017 onward based in part on the information provided by the couple.
“Stephen and Rebekah Schwartz conspired to defraud the SSA. By misrepresenting Mr. Schwartz as having a disabling condition that prevented him from working — although he had steady employment — their fraudulent scheme caused SSA to pay Mr. Schwartz more than $167,000 that he was not entitled to receive,” said Gail S. Ennis, inspector general for the Social Security Administration.
In February 2020, the couple filled out a form to determine if Steven Schwartz could keep receiving insurance payments. The couple claimed his job was “Justice of the Peace.” In February 2021, the SSA determined he was no longer eligible due to his employment at the roofing company. Rebekah Schwartz claimed her husband didn’t work for the company and said she was the one who earned the income.
In July 2021, investigators from the Office of the Inspector General for the SSA were present when the couple arrived at the Fort Smith SSA office to discuss the payments. The couple confessed to their fraudulent activities.