Five years ago, the Wall Street Journal published a story with the headline, “Disability-claim Judge Has Trouble Saying ‘No.’” It was a disturbing tale of how Social Security Disability Insurance claims Judge David “D.B.” Daugherty of Huntington granted appeals for benefits at an unprecedented rate.
The Journal reported that during one stretch, the generous judge awarded benefits in 1,280 of 1,284 cases where payments had been previously denied. Nationally, the average approval rate was about 60 percent. “Some of these judges act like it’s their own damn money we’re giving away,” Daugherty famously said.
But now, finally, Daugherty and two of his alleged cohorts are in deep trouble. A federal grand jury returned indictments on Tuesday against Daugherty, attorney Eric Conn of Stanville, Ky., and psychologist Alfred Adkins on charges they conspired to cheat the Social Security Disability Insurance system and award millions of dollars in benefits, while enriching themselves.
According to the indictment, Conn, who promoted himself as “Mr. Social Security,” recruited individuals in West Virginia, Kentucky and Ohio who had been denied disability benefits. Daugherty then “solicited Conn to submit false medical evidence so that Daugherty could issue fully favorable decisions” using the fraudulent information provided by Adkins.
The indictment contains formal criminal charges, but Daugherty, Conn and Adkins enjoy a presumption of innocence.
The indictment says this alleged phony assembly line of administrative justice caused the Social Security Administration to pay out benefits of over $600 million. Conn became enormously wealthy and, according to federal officials, made monthly cash withdrawals of $9,000 from a business account, with some of that money going to Daugherty.
The Journal reports “Mr. Conn is also charged with money laundering, conspiring to retaliate against a witness and destruction of records in a federal investigation. Messrs. Conn and Daugherty were charged with conspiring to launder monetary instruments.”
The Daugherty-Conn-Adkins cabal has also caused confusion and distress for hundreds of people awarded benefits, since their cases are now being re-evaluated. “The agency is now working through the complex process of determining whether Mr. Daugherty had sufficient evidence years ago to award benefits to Mr. Conn’s clients, some of whom were evaluated by Mr. Adkins,” the Journal reported.
The Congress approved SSDI in 1956 to provide payments for people whose disabilities prevented them from working. However, over the years this worthy program has morphed into another form of unemployment, swelling the rolls and depleting the fund.
“Social Security’s Disability Insurance Trust Fund now faces an urgent threat of reserve depletion, requiring prompt corrective action by lawmakers if sudden reductions or interruptions in benefit payments are to be avoided,” warned the most recent report from the Social Security and Medicare Board of Trustees.”
Once upon a time, Judge Daugherty could be flippant about other people’s money, but now those chickens have come home to roost, not only for the SSDI program, but also for Daugherty, Conn and Adkins.