SSA Beneficiaries Did Not Always Authorize Direct Deposit Changes by Telephone Leading to Direct Deposit Diversions

The Social
Security Administration (SSA) national 800-number allows the American public to
access information and services by making a telephone call. Before April 14,
2025, SSA staff could change a Social Security beneficiary’s direct deposit information
over the telephone by asking the caller to confirm certain personally
identifiable information retained in SSA’s records, to ensure the caller was
authorized to request the change.

From October
through December 2023, SSA OIG identified 3,109 beneficiaries who had direct
deposit changes initiated by SSA’s 800-number staff and reported to SSA they
had not received their benefit payment. SSA OIG determined these beneficiaries
did not always authorize direct deposit changes initiated by SSA’s 800-number
staff. It was estimated approximately 1,197 of the 3,109 (38.5 percent) beneficiaries
had benefit payments misdirected because of unauthorized direct deposit changes
to the amount of $2.2 million. As of April 2025, SSA OIG estimated SSA had not
recovered approximately $2 million of the estimated $2.2 million in misdirected
benefit payments.

SSA OIG could
not determine whether SSA’s 800-number staff followed policy regarding the
verification of callers’ identities before they made these direct deposit
changes. Recorded calls were no longer available and SSA did not maintain
evidence as to whether employees followed policy in its systems. At that time,
SSA only kept telephone recordings for 60 days.

SSA OIG then decided
to review sample cases of beneficiaries who had direct deposit changes initiated
by SSA’s 800-number staff in October in 2024, because this sample allowed for
the review of the recorded telephone calls which were now being maintained for
a six-month period. SSA OIG estimated SSA did not appropriately verify the
identities of 25,638 callers who contacted the Agency before changing the
beneficiaries’ direct deposit information. This lack of verifying identities increases
the risk of unauthorized direct deposit changes.

Although SSA had announced plans
to revise its policy, SSA OIG issued an early alert memorandum to SSA in March
2025 to inform the Agency that 800-number staff did not always follow policy to
verify a caller’s identity before making a direct deposit change. In April
2025, SSA revised its policy for direct deposit changes over the telephone. SSA
OIG believes this new policy will help reduce the risk of SSA’s 800-number
employees inappropriately verifying the identities of callers before making
direct deposit changes because it limits how changes can be made over the
telephone. In addition, the new policy requires stronger identity proofing and
authentication for direct deposit transactions.

Read the full report here.

Read a PDF of the press release here.

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