This policy, set to affect millions of recipients and applicants, will be effective from March 31. Beneficiaries will no longer be able to validate their identities via phone calls; they must either register for a “My Social Security” account online or make a physical visit to a Social Security office. The policy applies to both new applicants and existing beneficiaries intending to modify their direct deposit details.
The urgency to strengthen fraud controls is heightened as Elon Musk’s Department of Government Efficiency (DOGE) is actively working to reduce the federal government's size and eliminate fraud and waste. As reported by The Washington Examiner, President Donald Trump and Musk have concentrated their efforts on addressing alleged improper payments emanating from the agency responsible for providing retirement payments to the elderly.
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In preparation for the implementation of these new measures, the SSA will conduct employee training over the next fortnight. The agency announced on Tuesday that once enrolled, applicants could have funds deposited within one business day, a significant reduction from the previous 30-day period.
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However, this move to limit phone assistance coincides with DOGE's aggressive downsizing of the agency’s operations. Amidst the lowest staffing levels in half a century, the SSA has unveiled plans to slash up to 12% of its workforce, close six out of its ten regional offices, and offer early retirement packages to staff, including payments of up to $25,000.
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An internal memo circulated earlier this week by acting deputy commissioner for operations, Doris Diaz, suggested that the change could result in longer wait times and pose "increased challenges for vulnerable populations." The memo estimated that between 75,000 to 85,000 customers per week would be redirected to local field offices.
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Agency employees expressed confusion over these changes, particularly as the agency plans to terminate leases for several offices nationwide. One employee, who chose to remain anonymous, voiced concerns over the practicality of the new measures, given the increased need for in-person appointments and the potential difficulties for seniors who may have to travel long distances due to office closures.
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During a press call on Tuesday evening, the acting commissioner of the agency, Leland Dudek, downplayed the impact of these changes. He argued that many of the closed sites were primarily used for video hearings and did not serve many members of the public in-person. He cited "health and safety reasons" for the closure of a New York location but did not specify which of the three locations he was referring to.
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Dudek highlighted the financial implications of direct deposit fraud, stating, “We are losing over $100 million a year to direct deposit fraud.” He acknowledged the potential increase in field volume and assured that the agency would adjust its policies and procedures accordingly. He emphasized that these changes were designed to ensure the correct payment goes to the right person at the right time, a measure he compared to standard banking practices.
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Despite the criticism, Dudek remained committed to monitoring the situation closely and pledged to take necessary actions to improve services if the changes proved detrimental to the citizens they serve.
However, Democrats have criticized the changes, arguing that they could disadvantage older people living in rural areas or those without access to transportation. Senator Mark Warner (D-VA) expressed his deep concern, stating, “I’m deeply concerned by reports that Trump’s Social Security Administration might start phasing out phone support for seniors and force them to only seek help online or in-person. The goal is clear: make seniors’ benefits so hard to access that they can’t get them at all.”
Earlier on Tuesday, Dudek sent an internal memo detailing downsizing plans and efforts to implement artificial intelligence. He acknowledged his mistakes during his brief tenure leading the agency, stating, “I have made some mistakes. I will continue to make mistakes, but I will learn from them.”
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The government watchdog for the Social Security Administration reported last year that nearly $72 billion in improper payments were made from 2015 to 2022, accounting for less than 1% of total benefits paid during that period. The majority of these payments were overpayments, not to deceased Americans or people who did not qualify for them.
Next week, the Senate Finance Committee will hold a confirmation hearing for Frank Bisignano, a financial tech executive nominated by President Donald Trump to lead the agency permanently.
