PFD auditors work to root out cheaters

Officials say 'little white lies' can get people in trouble

Posted: Tuesday, October 02, 2007

The Alaska Permanent Fund's Dividend Division has heard it all when it comes to excuses to cover up fraud - from "my dog made me forget" to "I didn't know I was supposed to be living in Alaska."

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Catching cheaters is one of the division's responsibilities. Auditors look for people who don't disclose reportable absences, who apply under a false name or simply pretend to be a resident while living somewhere else.

On Wednesday the state will make its direct-deposit payments to Alaskans who filed for their dividend checks online. Other direct-deposit checks will go out Oct. 17 and the remaining checks will be sent by the U.S. Postal Service on Nov. 13. The amount of the dividend check this year is $1,654.

Reporting Fraud

To report cases of Alaska Permanent Fund dividend fraud, call the fraud hotline at 465-2654. The division, as required by law, keeps all information confidential and does not disclose names of informants.

Shawn Damerval, an investigator in the fraud investigations unit at the division, said one of the most common cases of fraud is parents continuing to apply for an ineligible child who has moved away from home.

"People just keep doing it," she said. "They've been applying for their children for all these years and think, 'Well, who's going to know?' But we will know. We will find out."

Not mentioning reportable absences is another no-no, and quite common, Damerval said.

"Sometimes people think of that as a little white lie, where, 'Oh, I'm eligible anyway. I don't need to disclose these.' So they don't, and that can get them in trouble," she said.

When discrepancies appear, the applicant is flagged for an audit, followed by a letter asking for an explanation. If the facts don't add up, investigators move in for a deeper probe.

"Sometimes we just stumble upon it in the review process," she said. "Somebody who's working a case will find an inconsistency, perhaps in the way absences are reported from one year to the next ... and so they'll refer that to the fraud section."

Many instances of fraud come to the division from tips reported by members of the general public. The permanent fund's fraud hotline offers a way for people in the community to report problems they see. Last year the division received nearly 2,000 tips and each one is reviewed, Damerval said.

"People in Alaska are wonderful when it comes to policing the PFD program," she said. "When we get (a tip) we start gathering information from whatever sources we can, including talking to the individual themselves and getting their side of the story."

The division coordinates with state and federal agencies, as well as an information technology specialist who helps with computer inconsistencies.

One of the more serious crimes is filing under a false identity, Damerval said.

"Sometimes you'll have someone move to the state under a false identity, hiding out maybe, and they'll apply for dividends under that false identity," she said.

Check theft and forgery are also common.

A few years ago a man living out of state was collecting checks for himself and several children.

"He had been submitting forged military documents in support of his being gone on allowable military absences, when in fact he had been separated from the military some years before," Damerval said. "He was actually working in Iraq as a private contractor."

The state ended up bringing him back to face charges.

The division has received more than a few interesting explanations from people who have reported being in Alaska when they really weren't, including the one in which a family was on vacation and the dog got hit by a car, causing them to forget how long they'd really been out of state.

"That put them into one of our audits," Damerval said.

"Our business is to pay people who are eligible. The majority of Alaskans are honest, and the majority of the people applying are eligible. We're here to watch, and where there really is fraud, we want to get that," Damerval said. "But we're not out to get people who make a mistake, or who just weren't paying attention when they filed."

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