Skip to main content
Press Release

Neosho Woman Pleads Guilty to Social Security Fraud After Concealing $4 Million Settlement

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

SPRINGFIELD, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that a Neosho, Mo., woman pleaded guilty in federal court today to illegally receiving federal disability benefits for her son for seven years, while concealing a $4 million settlement that provided them with a home and income.

Kerry D. Sanders, 47, of Neosho, pleaded guilty before U.S. Magistrate Judge David P. Rush to one count of participating in a conspiracy to steal government property and one count of theft of government property.

By pleading guilty today, Sanders admitted that she conspired from May 2005 until July 2012 to receive at least $56,138 in Social Security disability benefits to which she was not entitled.

Sanders was approved to become her son’s representative payee when he was born in 2001 and began receiving Supplemental Security Income due to his disabilities. A $4 million monetary settlement was paid to her son surrounding his birth, with a conservatorship set up to receive the settlement proceeds that began with the first disbursement of $164,290 in 2005. Sanders admitted that she concealed this income from the Social Security Administration and provided false statements in order to continue receiving federal benefits.

Sanders also admitted that she concealed the purchase of a home by the conservatorship in April 2008. Sanders falsely claimed that she paid $400 per month to rent the home where she lived with her son, and which she shared with a co-conspirator. The conservatorship did not require either Sanders or her co-conspirator to pay rent for the home.

As the funds held in the conservatorship could be used for the support and maintenance of Sanders’s son, the conservatorship constituted both a resource and income, and as such, Sanders was required to report its existence to the Social Security Administration in its oversight of his eligibility for Supplemental Security Income. The actions of Sanders and her co-conspirator in concealing the conservatorship, the home, and the living arrangement led to the Social Security Administration paying at least $56,138 in benefits to which her son was not entitled.
Under federal statutes, Sanders is subject to a sentence of up to 15 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

This case is being prosecuted by Assistant U.S. Attorney Casey Clark. It was investigated by the Social Security Administration, Office of Inspector General.

Updated October 24, 2017

Financial Fraud