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Press Release

Douglas Edward Cottrell Sentenced In U.S. District Court

For Immediate Release
U.S. Attorney's Office, District of Montana

The United States Attorney's Office announced that during a federal court session in Great Falls, on January 23, 2013, before U.S. District Judge Sam E. Haddon, DOUGLAS EDWARD COTTRELL, a 42-year-old resident of Great Falls, appeared for sentencing. COTTRELL was sentenced to a term of:

Probation: 3 years

Special Assessment: $100

Restitution: $7,707

COTTRELL was sentenced in connection with his guilty plea to supplemental social security income benefit fraud.

In an Offer of Proof filed by Assistant U.S. Attorney Bryan R. Whittaker, the government stated it would have proved at trial the following:

Beginning in August 2007, and continuing until December 2009, COTTRELL, intentionally concealed and failed to disclose his incarceration in Montana State Prison in order to continue to receive SSI and SSDI benefits payments provided to him by the Social Security Administration.

On April 13, 2007, COTTRELL applied for Social Security Supplemental Security Income ("SSI") benefits. COTTRELL was advised by the claims representative that he must legally report events that could affect his eligibility for SSI and Social Security Disability Insurance ("SSDI").

On May 25, 2007, the SSA claims representative conducted an SSI application review with COTTRELL and again advised him of his legal obligation to report events affecting his eligibility to SSI. Several of those events included his fugitive felon and parole or probation violation status, his living arrangements, his resources, and his income. He was approved for both SSI and SSDI.

On June 1, 2007, SSA sent COTRELL a "Notice of Award" letter for his SSI application. The letter also included a pamphlet, "What you need to know when you get SSI." Both the pamphlet and the letter again advised COTTRELL of his legal reporting requirements regarding events affecting his eligibility to SSI. Indeed, the pamphlet informed COTTRELL he must report his incarceration and stated, "benefits usually are not paid to someone who commits a crime and is confined to an institution by court order and at public expense." SSA sent another letter and pamphlet to COTTRELL on June 3, 2007 relating to the SSDI payments.

On June 8, 2007, COTTRELL was convicted of felony sexual assault in Cascade County and was sentenced to 10 years with 6 years suspended in Montana State Prison. He was admitted to prison on August 13, 2007.

Several years later, the SSA Great Falls Office received an anonymous call stating that the caller did not think it was right that COTTRELL could collect SSI and SSDI benefits while incarcerated in Deer Lodge. The SSA began an investigation and verified that COTTRELL was incarcerated and had a scheduled release date of July 3, 2011.

Shortly thereafter, SSA interviewed COTTRELL and he stated that he knew that he was required to report his incarceration and that if he did he would lose his SSI and SSDI benefits. He indicated that he had attempted to send one letter to SSA to notify them of his incarceration. No letter was ever received by SSA. He said he made no further attempts to contact SSA after the letter. He stated, "Yes, I knew that if I was getting the payments [SSA benefits], then the SSA probably didn't know I was in prison, but it was on the government."

During COTTRELL's incarceration, he was visited by his fiancé. COTTRELL told investigators that he told her to take the SSA benefit payments out of his personal bank account to pay rent, car payments, bills, and to deposit some of the money into his prison account.

The total amount of overpayment based upon the unauthorized payments and upon COTTRELL's failure to report the required events was $18,464.

Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that COTTRELL will likely serve all of the time imposed by the court. In the federal system, COTTRELL does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.

The investigation was conducted by the Social Security Administration - Office of Inspector General.

Updated January 14, 2015