Generally, a person is without fault if an overpayment occurs due to an error in computing insured status. If, however, an earnings record is fraudulent (whether or not the fraud was committed for the purpose of obtaining benefits), a finding of without fault cannot be made unless it is clear that the person was not involved in the fraud.

Ralph Folley was denied retirement benefits because he needed one additional QC to be insured. He arranged for his brother to report that he earned $600 although he did no work. Ralph reapplied for and was awarded benefits the next year. It was later discovered that Ralph did not work for his brother and, therefore, should never have received benefits. Since Ralph had fraudulently obtained insured status, he is at fault for his overpayment.