A Houston Social Security insider who turned his access to government records to run a $3.3 million fraud scheme was sentenced Friday in federal court, after prosecutors said he surreptitiously redirected survivor payments using the identities of recently deceased males. The punishment was announced by the United States Attorney’s Office for the Southern District of Texas in a post on X.
What prosecutors say
According to a press statement, the defendant is David Lam, 45, of Pearland, who worked as an operations supervisor and claims specialist for the Social Security Administration in Houston. Lam pleaded guilty in June to conspiracy to defraud the United States and aggravated identity theft and agreed to pay $3,346,280 in restitution, according to the U.S. Attorney’s Office for the Southern District of Texas.
How the scam worked
According to investigators from the Social Security Administration’s Office of Inspector General, Lam exploited his position to get personally identifying information on recently deceased individuals, such as names, dates of birth and death, and Social Security numbers. According to the SSA Office of Inspector General, he then constructed phony survivor profiles and utilized them to claim survivor payments on behalf of unrelated women and children. Co-conspirators reportedly returned shares of the unlawfully gained benefits to Lam via payment apps like Zelle, Cash App, and Chime.
Sentence announced Friday
On Friday, the US Attorney’s Office posted the sentencing notification on X, linking to the office’s case papers and publicly attaching the penalty to Lam’s June plea and commitment to pay restitution.
Penalties and legal context
The maximum term for conspiracy to defraud the United States is five years under 18 U.S.C. § 371. Aggravated identity theft, as per 18 U.S.C. 1028A, mandates a concurrent two-year sentence.
Local fallout
Several Southern District prosecutions target scams that exploit government subsidies, including this case. Lam’s previous guilty plea in June received attention in local media.
Investigators and next steps
The issue was investigated by the SSA Office of Inspector General, the IRS Criminal Investigation, and the Treasury Inspector General for Tax Administration, according to officials. The United States Attorney’s Office has requested that anyone with information on fraud involving federal benefits contact the Southern District of Texas Public Affairs office.
Leave a Reply