Manchester Man Sentenced for Social Security Fraud

BOSTON – A Manchester man was sentenced today for stealing more than $160,000 in government benefits to which he was not entitled.

Charles Gerbutavich, 71, was sentenced by U.S. District Court Judge Rya W. Zobel to one year of probation, including three months of home confinement, and was ordered to pay a $3,000 fine and $161,587 in restitution to the Social Security Administration.  In October 2014, Gerbutavich pleaded guilty to stealing public money in the form of Social Security payments paid out for the benefit of his father.

Gerbutavich’s father died in 1993, but his monthly Social Security benefits continued to be directly deposited into a joint bank account in his and Gerbutavich’s names.  From 1993 to 2014, Gerbutavich continued to receive his deceased father’s benefits totaling $161,587. 

This case was brought as part of an ongoing effort by the U.S. Attorney’s Office in partnership with the Social Security Administration to investigate and prosecute the posthumous fraud of Social Security benefits.  In many of these cases, family members, knowing they are not entitled to government benefits, continue to withdraw and spend the funds after a relative has died. 

One of the ways the Social Security Administration detects this kind of fraud is through the Medicare Non-Utilization Project, in which the agency investigates people receiving benefits who are at least 90 years old and who have not used their Medicare Part B benefits for three or more years.  In some instances, the agency learns that such a person is actually deceased, but a surviving child has continued to take the deceased person’s benefits.

Since October 2013, the U.S. Attorney’s Office has prosecuted several similar cases involving a total of more than $1 million in stolen government money.

In January 2015, Graeme Griffith, of Andover, pleaded guilty to taking his deceased father’s Social Security benefits totaling $149,285, which were directly deposited into a joint bank account after the father’s death in 2003.  Griffith is scheduled to be sentenced on April 16, 2015.

In October 2014, Mary Murphy, of Dorchester, was sentenced to 18 months of home confinement, 10 hours per week of community service, and was ordered to pay a fine of $40,000 and $331,630 in restitution – which she paid in full in October – for taking her deceased mother’s Social Security and Civil Service retirement benefits, which were directly deposited into a joint bank account after her death in 1977.

Also in October 2014, Richard Oldham, of Old Orchard Beach, Maine, was sentenced to four months in prison, six months of home confinement, and was ordered to pay $195,862 in restitution for endorsing Social Security checks in his deceased mother’s name following her death in 1993. 

In September 2014, Frances Kenney Moseley, of Boston, pleaded guilty to stealing over $220,000 in Social Security benefits, which were directly deposited into her father’s bank account after his death in 2003.  Moseley is scheduled to be sentenced on March 23, 2015.

In August 2014, George Bergstrom, of Shrewsbury, was sentenced to one year of probation and was ordered to pay $57,948 in restitution – which he paid in full in August – for taking his deceased mother’s Social Security benefits, which were directly deposited into a joint bank account after her death in 2009.

In October 2013, John Flaherty of Newburyport, was sentenced to 10 months in prison and was ordered to pay $168,830 in restitution for taking his deceased mother’s Social Security benefits, which were directly deposited into a joint bank account after her death in 1993.

United States Attorney Carmen M. Ortiz and Scott Antolik, Special Agent in Charge of the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division, made the announcement today.  The Gerbutavich case is being prosecuted by Special Assistant U.S. Attorney Timothy Landry of Ortiz’s Major Crimes Unit.