Florida Psychiatrist Pleads Guilty to Social Security Disability Fraud

Tampa, FL (Law Firm Newswire) January 8, 2019 - A psychiatrist in Hobe Sound, Florida, recently pleaded guilty to Social Security disability fraud and other charges after receiving hundreds of thousands of dollars in fraudulent disability benefits over several years.

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A federal grand jury indicted Arthur John Kranz on wire fraud, mail fraud, theft of government funds and tax evasion charges in connection with his failure to report his work activity. The U.S. Department of Justice said Kranz started receiving disability payments in 2002 from his private insurance company after filing a claim based on the grounds that he was unable to work. The doctor then applied for Social Security disability benefits in December 2003. He began to receive two forms of disability payments after the Social Security Administration (SSA) approved his application.

“The Social Security Administration does not take kindly to fraud and has ramped up investigations into attempts to cheat the program,” commented Florida social security disability attorney David W. Magann. “While having two forms of disability payments is legal, failing to report employment is considered fraud. Individuals who have any questions or concerns about obtaining disability benefits should contact an experienced attorney to help guide them through the process and provide effective representation.”

Kranz failed to disclose his employment status to the SSA and his insurance company when he started working at a Pennsylvania hospital between January 2006 and March 2013. According to court documents, Kranz earned an income of more than $1.6 million as a psychiatrist at the hospital.

The Justice Department accused Kranz of amassing over $700,000 in fraudulent disability payments from his insurance company and the SSA. He attempted to hide his income from them and the Internal Revenue Service (IRS) in order to continue collecting disability benefits. Kranz filed fraudulent income tax returns that omitted his earnings from being employed at the hospital. He also presented his insurance company with paperwork that fraudulently stated he was unemployed.

Kranz faces prison sentences for the various charges, including up to five years for tax evasion, five years for Social Security fraud and 20 years for wire fraud. The psychiatrist must also undergo supervised release and is required to pay restitution of over $341,000 to his insurance company, around $451,000 to the SSA and a court-determined sum to the IRS. He will be sentenced in February 2019.

David W. Magann, P.A.
Main Office:
156 W. Robertson St.
Brandon, FL 33511
Call: (813) 657-9175

Tampa Office:
4012 Gunn Highway #165
Tampa, Florida 33618

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