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HA 01560.005B Puerto Rico (Luis Escabi-Perez, M.D. — Non-Referral Cases; ESNR) (Redacted)

Table of Contents
IPurpose
IIBackground
IIIHearings Level Procedures
IVAppeals Council Procedures
VInquiries
Attachment 1Plea Agreement
Attachment 2Dr. Escabi-Perez's Statement Under Penalty of Perjury dated October 23, 2015
Attachment 3OIG Section 1129(l) Referral dated February 24, 2016
Attachment 4OIG Supplemental Section 1129(l) Referral dated December 28, 2017
Attachment 5Escabi Report
Attachment 6Notice of Hearing

Issued: January 22, 2021

Revised: June 14, 2023

I. Purpose

This Temporary Instruction advises Office of Hearings Operations (OHO) and Office of Appellate Operations (OAO) in the Office of Analytics, Review, and Oversight (OARO) employees of the procedures for processing certain "non-referral" cases, in which the applications include evidence from Luis Escabi-Perez, M.D. (Dr. Escabi-Perez), but the Office of the Inspector General (OIG) of the Social Security Administration (SSA) did not identify these cases in a referral under section 1129(l) of the Social Security Act (Act). See the background section below for more information.

This instruction replaces any prior instruction and will be modified as additional information becomes available.

NOTE: 

Nothing in this instruction precludes OHO or OAO staff or adjudicators from referring suspected instances of fraud or similar fault to OIG using the procedures in Hearings, Appeals and Litigation Law (HALLEX) manual HA 01130.006 or HA 01130.009.

II. Background

In 2015, after an extensive investigation by OIG and the U.S. Department of Justice, a Federal Grand Jury in Puerto Rico indicted psychiatrist Dr. Escabi-Perez, as well as several beneficiaries who were Dr. Escabi-Perez's patients, for creating and submitting fraudulent evidence in support of the beneficiaries' applications for Social Security benefits. Dr. Escabi-Perez later pleaded guilty to wire fraud related to the transmission of fraudulent psychiatric reports to SSA. Several beneficiaries pleaded guilty to theft of government funds and property, in the form of receipt of disability benefits to which they were not entitled. See Attachment 1 for a copy of Dr. Escabi-Perez's plea agreement dated July 17, 2015.

In October 2015, subsequent to the entry of Dr. Escabi-Perez's plea agreement, he signed a Statement Under Penalty of Perjury in which he made further admissions as described in HALLEX HA 01560.005A II. See also Attachment 2 for a copy of Dr. Escabi-Perez's Statement Under Penalty of Perjury dated October 23, 2015.

In accordance with section 1129(l) of the Act, OIG notified SSA on February 24, 2016, that it had reason to believe fraud was involved in the application of individuals seen by Dr. Escabi-Perez for monthly disability insurance benefits under title II of the Act. OIG referred specific cases to SSA under section 1129(l) of the Act where it appeared that information in the individuals' files contained backdated evidence. See Attachment 3 for a copy of the February 24, 2016, OIG section 1129(l) referral. By supplemental memorandum dated December 28, 2017, OIG clarified Dr. Escabi-Perez's fraud scheme and identified additional individuals it had reason to believe that fraud was involved in their applications for monthly disability insurance benefits under title II of the Act. OIG explained that the fraud scheme also involved the submission of Psychiatric Medical Reports (DDPR-79 or similar document) to SSA containing template language that represented symptoms and medical conditions that the patients did not actually experience, for the purpose of tricking or deceiving SSA into approving the payment of monthly disability insurance benefits. See Attachment 4 for a copy of OIG's supplemental section 1129(l) referral.

Based on the OIG section 1129(l) referrals, SSA is required under section 205(u) of the Act to take action on cases identified by OIG. SSA must redetermine the entitlement to benefits for individuals identified by OIG and disregard certain evidence submitted by Dr. Escabi-Perez in the referred cases if SSA finds there is a reason to believe that fraud or similar fault was involved in the providing of that evidence (see HALLEX HA 01560.005 and HA 01560.014). SSA must also disregard certain evidence submitted by Dr. Escabi-Perez in processing referred non-redetermination cases (see HALLEX HA 01560.005A).

The 1129(l) referrals from OIG listed individual cases. However, SSA is aware of other cases in which the applications include evidence from Dr. Escabi-Perez, but OIG did not identify these cases in an 1129(l) referral. The fact that OIG did not refer a case to SSA in the 1129(l) referrals does not amount to a factual finding that fraud or similar fault was not involved or preclude SSA from making such a finding based on the available evidence.

Under section 205(u)(1)(B) of the Act, SSA must disregard any evidence if there is reason to believe that fraud or similar fault was involved in providing that evidence.

In cases processed under this instruction, OHO and OAO adjudicators will use the procedures in Social Security Ruling (SSR) 22-2p: Titles II and XVI: Evaluation of Claims Involving the Issue of Similar Fault in the Providing of Evidence when deciding whether to disregard evidence because of fraud or similar fault. Before SSA disregards evidence under section 205(u)(1)(B) of the Act at the hearings level of the administrative review process, it will consider the individual's objection to the disregarding of the evidence.

III. Hearings Level Procedures

A. General

OHO staff will verify whether the case contains evidence from Dr. Escabi-Perez but was not referred by OIG under section 1129(l) of the Act. If so, OHO will identify cases in the Case Processing and Management System (CPMS) and Hearings and Appeals Processing System (HACPS) with the case characteristics “ESNR” (Escabi-Perez Non-Referral) and “FRD3” (Suspected Fraud No Prior Award) and process cases using the following instructions. The Special Review Cadre (SRC) in OHO has been assigned to process the cases described in this instruction. OHO will ensure that the case is routed to the SRC, rather than the claimant's servicing hearing office, by permanently transferring the case to the SRC (Hearing Office code 5ZU).

NOTE: 

If a case processed under this instruction involves facts and evidence requiring processing under a separate instruction in HALLEX HA 01560.000, SRC staff will add the case characteristic “FHYB” (Fraud Hybrid) in addition to the above and any other applicable case characteristics directed by the separate instruction.

B. Evidence

1. Screening

Designated adjudicators will review the file to determine whether it contains any of the following:

  • •

    Medical evidence supplied, prepared, or signed by Dr. Escabi-Perez.

If the file contains any of the evidence as outlined above, or if the adjudicator suspects that fraud or similar fault was involved in the provision of any other evidence, the adjudicator will determine whether there is an issue of fraud or similar fault that requires adjudication in accordance with SSR 22-2p.

If an issue of fraud or similar fault requires adjudication, the adjudicator will offer the individual an opportunity for a hearing and continue processing the case. At the hearing, the individual will have the opportunity to object to the disregarding of evidence. The adjudicator will process the case using the instructions below.

2. Fraud or Similar Fault Identified as an Issue for Adjudication

If, after screening, the adjudicator determines there is an issue of fraud or similar fault requiring adjudication, SRC staff will add a Possible Fraud or Similar Fault (Special F) flag in eView for an electronic claim(s) file or attach the flag to the front of a paper claim(s) file.

Additionally, if it is not already part of the record, SRC staff will add a copy of the OIG section 1129(l) referrals, plea agreement, Dr. Escabi-Perez's Statement Under Penalty of Perjury, the Escabi Report, and any other relevant document(s) to the claim(s) file. In paper cases, SRC staff will add these documents to Part B - Jurisdictional Documents/Notices (red tab) of the claim(s) file. In electronic cases, OHO staff will upload these documents using document type 7011-Misc. Jurisdictional Documents/Notices to Part B - Jurisdictional Documents/Notices (red tab) of the claim(s) file. See Attachments 1, 2, 3, 4, and 5 for copies of these materials.

3. Reason to Believe Standard

Under section 205(u)(1)(B) of the Act, SSA must disregard evidence when there is reason to believe that fraud or similar fault was involved in the providing of such evidence. See HALLEX HA 01130.015 C.1. for the definition of “reason to believe.”

In determining if there is a reason to believe that fraud or similar fault exists, the adjudicator may consider, among other evidence, Dr. Escabi-Perez's plea agreement, the OIG section 1129(l) referrals, Dr. Escabi-Perez's Statement Under Penalty of Perjury, and the Escabi Report.

Before the administrative law judge (ALJ) disregards the evidence under section 205(u)(1)(B) of the Act at the hearings level of our administrative review process, the ALJ will consider the individual's objection to the disregarding of that evidence. After considering any objections, the ALJ will decide whether there is reason to believe that fraud or similar fault was involved in providing evidence in that individual's case.

If, after the hearing and considering any objections, the ALJ finds there is reason to believe that fraud or similar fault was involved in the provision of evidence, the ALJ will disregard such evidence under section 205(u)(1)(B) of the Act.

If the ALJ does not find there is reason to believe that fraud or similar fault was involved in the provision of the evidence, the ALJ will not disregard the evidence under section 205(u)(1)(B) of the Act. Rather, the ALJ will evaluate it in accordance with SSA's existing policies regarding evaluation of symptoms and medical evidence. The ALJ will consider any internal inconsistencies in the individual's statements, as well as inconsistencies with other evidence. See 20 CFR 404.1513a, 404.1527, and SSR 16-3p: Titles II and XVI: Evaluation of Symptoms in Disability Claims.

NOTE 1: 

SSA generally does not develop evidence of a claimant's intent. Therefore, a finding of similar fault in accordance with SSR 22-2p is sufficient for the ALJ to disregard the evidence at issue. See HALLEX HA 01295.010 A.

NOTE 2: 

If the agency disregarded evidence at another level of the administrative process after finding fraud or similar fault, the ALJ will use the information in SSR 22-2p to determine whether there is a reason to believe that fraud or similar fault was involved in the provision of evidence, and will consider the individual's objection to the disregarding of that evidence. If there is not a reason to believe fraud or similar fault was involved in the provision of the evidence, the ALJ will add the information into the record and consider it when adjudicating the claim.

4. Other Evidence

In some cases, it may also be appropriate to disregard evidence provided by a source who was not involved in Dr. Escabi-Perez's fraudulent scheme. For example, if a physician relies on medical evidence from Dr. Escabi-Perez that the ALJ disregards, then the ALJ must also disregard the parts of the physician's report relying on the disregarded evidence, or, when based solely on the disregarded evidence, the entire document. When the degree of reliance on medical evidence from Dr. Escabi-Perez is unclear, the ALJ will evaluate the evidence in accordance with SSA's existing policies regarding the evaluation of medical evidence.

NOTE: 

Cases with evidence from Dr. Escabi-Perez that are not part of the OIG section 1129(l) referrals may also contain evidence subject to special case processing instructions, such as HALLEX HA 01560.001 and HALLEX HA 01560.001A. The instructions in this provision are meant to supplement those instructions.

C. Exhibiting and Marking Issues

Disregarded evidence must remain in the claim(s) file, and the ALJ must ensure that medical evidence from Dr. Escabi-Perez (or other disregarded evidence) is clearly identified.

In electronic cases, SRC staff will clearly designate the information as “DISREGARDED-FSF” in the Note field in eView or the Electronic Non-Medical (ENM) application. In a paper claim(s) file, SRC staff will add “DISREGARDED-FSF” on the first page of the information with the number of pages and on each subsequent page. To illustrate, a two-page submission that is disregarded would be marked as follows: page 1 “DISREGARDED-FSF 1/2” and page 2 “DISREGARDED-FSF 2/2.”

NOTE 1: 

To ensure that claimants and any representative with access to the electronic file can identify and object to the disregarding of the evidence in question, SRC staff will exhibit the evidence, even if the ALJ determines that it should be disregarded.

NOTE 2: 

If the ALJ disregards only certain portions of evidence from a source, SRC staff will remove the information using the same procedures for removing personally identifiable information (PII) that is not properly associated with a claim(s) file. The ALJ will retain both versions of the evidence (the original and redacted) in the claim(s) file, exhibiting both, but identifying the non-redacted version as above with the caption “PORTIONS DISREGARDED-FSF-See Ex.[**].”

NOTE 3: 

If another administrative level previously disregarded evidence, or the hearings level in a remanded case previously disregarded evidence, and the ALJ subsequently determines that the agency should not have disregarded the evidence, SRC staff will update eView, ENM, or the paper claim(s) file to reflect the evidence was not disregarded

D. Notice of Hearing

Prior to an ALJ determining there is reason to believe fraud or similar fault was involved in the provision of evidence in support of the claimant's application, the ALJ will offer the claimant an opportunity for a hearing. The ALJ must give notice to the claimant and their representative, if any, regarding the issues related to disregarding evidence. To give notice regarding the statutory basis for disregarding evidence, the ALJ will use specific language in the “It Is Important That You Attend Your Hearing” and “Issues I Will Consider” sections of the notice of hearing. See Attachment 6 for a sample Notice of Hearing. If the claimant or their representative objects to the disregarding of evidence, the ALJ will evaluate the objection and arguments using the procedures in SSR 22-2p.

If the ALJ decides to disregard other evidence based on fraud or similar fault from an individual or entity other than Dr. Escabi-Perez, the ALJ will also provide notice in the notice of hearing.

E. Decision Language

In all decisions, the ALJ will specifically explain in the decision that:

  • •

    After an extensive investigation by multiple United States government agencies, a Federal Grand Jury for the District of Puerto Rico indicted psychiatrist Dr. Escabi-Perez, M.D. (Dr. Escabi-Perez), for submitting fraudulent psychiatric medical reports in support of individuals' applications for Social Security benefits. Dr. Escabi-Perez pleaded guilty to charges related to Social Security fraud and admitted to submitting fraudulent psychiatric reports and backdating evidence in medical files of patients who applied for Social Security benefits.

  • •

    As required by section 1129(l) of the Social Security Act (Act), in February 2016 and December 2017, the Office of the Inspector General (OIG) notified the Social Security Administration (SSA) that it had reason to believe fraud was involved in the applications for disability benefits of patients seen by Dr. Escabi-Perez. OIG did not identify the claimant's case. However, our own review shows that there is evidence from Dr. Escabi-Perez in the claimant's case file.

  • •

    Under section 205(u) of the Act, SSA must disregard evidence when there is reason to believe fraud or similar fault was involved in the providing of that evidence.

  • •

    Dr. Escabi-Perez provided evidence in the claimant's case, and the ALJ was required to make a finding regarding whether there was a reason to believe that fraud or similar fault was involved in the providing of the medical evidence from Dr. Escabi-Perez [and/or evidence in which a source relied on medical evidence from Dr. Escabi-Perez].

  • •

    The ALJ allowed the claimant the opportunity to object to the disregarding of evidence from Dr. Escabi-Perez [and other named evidence if applicable]. [If applicable] The ALJ considered the claimant's objections to the disregarding of evidence. [Explanation for the finding].

  • •

    [If evidence was disregarded] The ALJ found a reason to believe fraud or similar fault was involved in the providing of evidence from Dr. Escabi-Perez and disregarded that evidence. [Explanation for the finding].

  • •

    [If some of the evidence was not disregarded] The ALJ found no reason to believe fraud or similar fault was involved in the providing of the following evidence from Dr. Escabi-Perez and did not disregard those pieces of evidence. [Explanation for the finding].

  • •

    [If no evidence was disregarded] The ALJ found no reason to believe fraud or similar fault was involved in the providing of evidence from Dr. Escabi-Perez and did not disregard any evidence. [Explanation for the finding].

  • •

    The ALJ considered all of the evidence of record, [if applicable] excluding any disregarded evidence, and decided the case on the remaining evidence.

  • •

    The claimant may appeal the ALJ's decision regarding the issue of disability and the disregarding of evidence.

For all evidence, other than medical evidence from Dr. Escabi-Perez, the ALJ will use the procedures in SSR 22-2p to determine whether to disregard evidence because of fraud or similar fault. See also HALLEX HA 01130.015 D. If the ALJ disregards other evidence based on a fraud or similar fault issue, the ALJ must clearly address the other evidence and explain why it was disregarded. See HALLEX HA 01295.014. The claimant may appeal the fraud or similar fault finding.

IV. Appeals Council Procedures

The instructions below apply to cases before the Appeals Council (AC) in which SSA has identified the applications as including evidence from Dr. Escabi-Perez, but OIG did not identify these cases in a section 1129(l) referral.

A. Handling Requests for Review When the Disregarding of Evidence is an Issue

If the AC receives a request for review in a case in which a prior adjudicator disregarded evidence at another administrative level under subsection III. above, the AC will assess whether the evidence was properly disregarded and follow its usual request for review procedures. In processing requests for review in these cases the AC will keep in mind that under SSR 22-2p, before an adjudicator disregards evidence at the hearings level, they will consider the individual's objection to the disregarding of that evidence. The AC will generally grant review and remand cases where the claimant has not yet been afforded that opportunity.

1. Documenting the System and the Record

OAO staff will verify whether the case contains evidence from Dr. Escabi-Perez. The AC will ensure any non-referral cases involving evidence from Dr. Escabi-Perez, as described in subsection III.B.1. above, include the case characteristic “ESNR” in the Appeals Review Processing System (ARPS).

NOTE 1: 

If OAO staff encounter a case that does not have the case characteristic of “ESNR” and which contains evidence from Dr. Escabi-Perez that was not identified at another administrative level, they will consult the Executive Director's Office (EDO) by sending an email to ^DCARO OAO Fraud Redetermination to verify whether the case was referred by OIG under section 1129(l) of the Act under HALLEX HA 01560.005 or HA 01560.005A.

NOTE 2: 

If a case processed under this instruction involves facts and evidence requiring processing under a separate instruction in HALLEX HA 01560.000, OAO staff will ensure that the case characteristic “FHYB” (Fraud Hybrid) has been added to the case in addition to the above and any other applicable case characteristics directed by the separate instruction.

If it is not already part of the record, OAO staff will add a Possible Fraud or Similar Fault (Special F) flag in eView or attach the flag to the front of a paper claim(s) file.

Additionally, if it is not already part of the record, OAO staff will add a copy of Dr. Escabi-Perez's plea agreement, the OIG section 1129(l) referrals, Dr. Escabi-Perez's Statement Under Penalty of Perjury, the Escabi Report, and any other relevant document(s) to the claim(s) file. In paper cases, OAO staff will add the documents to Part B - Jurisdictional Documents/Notices (red tab) of the claim(s) file. In electronic cases, OAO staff will upload the documents using document type 7011-Misc. Jurisdictional Documents/Notices to Part B - Jurisdictional Documents/Notices (red tab) of the claim(s) file. See Attachments 1, 2, 3, 4, and 5 for copies of these materials.

2. Evidence

Under section 205(u)(1)(B) of the Act, SSA must disregard evidence when there is reason to believe that fraud or similar fault was involved in the providing of such evidence. Before SSA disregards evidence under section 205(u)(1)(B) of the Act at the hearings level of the administrative review process, it will consider the individual's objection to the disregarding of the evidence.

NOTE: 

In some cases, it may also be appropriate to disregard evidence provided by a source who was not involved in Dr. Escabi-Perez's fraudulent scheme. For example, if a physician relies on medical evidence from Dr. Escabi-Perez that the AC disregards, then the AC must also disregard the parts of the physician's report relying on the disregarded evidence, or, when based solely on the disregarded evidence, the entire document. When the degree of reliance on medical evidence from Dr. Escabi-Perez is unclear, the AC will evaluate the evidence in accordance with SSA's existing policies regarding the evaluation of medical evidence. However, before the AC disregards any evidence, the AC must ensure the claimant had previously been provided the opportunity to object to the disregarding of that evidence at the hearings level.

3. Exhibiting and Marking Issues

Disregarded evidence must remain in the claim(s) file, and the AC must ensure that medical evidence from Dr. Escabi-Perez (or other disregarded evidence) is clearly identified. Generally, the ALJ should have exhibited disregarded evidence, and the AC must ensure that disregarded evidence is clearly identified as disregarded. In electronic cases, the AC will ensure OAO staff identified the information as “DISREGARDED-FSF” in the Note field in eView or ENM. In a paper claim(s) file, the AC will ensure OAO staff added “DISREGARDED-FSF” on the first page of the information with the number of pages and on each subsequent page. To illustrate, a two-page submission that the AC disregards would be marked as follows: page 1 “DISREGARDED-FSF 1/2” and page 2 “DISREGARDED-FSF 2/2.”

NOTE: 

To ensure that claimants and representatives with access to the electronic file can identify and object to the disregarding of the evidence in question, SRC staff will exhibit the evidence even if the ALJ determines that it should be disregarded. The AC will not identify evidence as "disregarded" unless the claimant had previously been provided the opportunity to object to the disregarding of the evidence at the hearings level. If the AC subsequently determines that the agency should not have disregarded the evidence, OAO staff will update eView, ENM, or the paper claim(s) file to reflect the evidence was not disregarded.

4. Fraud or Similar Fault Findings at Another Administrative Level

a. Evidence Automatically Disregarded

If the AC receives a request for review in a non-referral case processed under this instruction in which an ALJ, under now rescinded SSR 16-2p: Titles II and XVI: Evaluation of Claims Involving the Issue of Similar Fault in the Providing of Evidence, automatically disregarded the evidence without a fraud or similar fault finding, the AC will generally grant review. The automatic disregarding of evidence is an error of law that requires the AC to grant review to issue a fully favorable decision or remand.

b. Cases with Fraud or Similar Fault Findings

If the AC receives a request for review in a non-referral case processed under this instruction, and the ALJ made a finding regarding whether there was a reason to believe that fraud or similar fault was involved in the providing of evidence under now rescinded SSR 16-2p or under SSR 22-2p, then the AC will assess whether the ALJ properly followed the instructions in subsection III. and follow its usual request for review procedures. If a grant review action is appropriate after reviewing the remaining evidence, the AC will follow the instructions in subsection IV.A.5. below.

c. Cases without Fraud or Similar Fault Findings

If the ALJ did not address an issue of fraud or similar fault, but the AC identifies that issue on review, the AC will generally grant review and either remand the case to an ALJ or issue a decision using the language in subsection IV.A.5.c. below.

5. AC Actions

In all cases, the AC will use the standard notice from the Document Generation System (DGS) with modifications as noted below.

a. Dismissal of Request for Review

The AC may dismiss requests for review for cases involving fraud or similar fault identified at a prior level of adjudication under the circumstances set forth in HALLEX HA 01340.001. When appropriate, no change to the standard notice is required. However, if the dismissal criteria are present but would result in the payment of benefits, the AC will consult with the EDO before taking any action.

b. Denial of Request for Review

As provided in subsection IV.A.4., the AC will not deny requests for review in cases in which a prior adjudicator automatically disregarded suspect evidence without determining whether there is a reason to believe fraud or similar fault was involved in the provision of evidence, or the adjudicator did not provide the claimant the opportunity to object to the disregarding of the evidence. The AC may otherwise deny a request for review provided there is no basis under the regulations for granting or dismissing the request (see HALLEX HA 01330.001).

c. Grant Review Action

A grant review action is appropriate if any basis for granting review is present.

The AC may issue a decision to resolve an issue of fraud or similar fault when the file contains sufficient evidence to determine whether there is a reason to believe that fraud or similar fault was involved in the provision of evidence, the claimant was provided the opportunity to object to the disregarding of the evidence at the hearings level, and a remand is not necessary to decide all adjudication issues involved in the claim.

The AC will evaluate whether it can issue a fully favorable decision in the absence of the suspect evidence. If the record supports a fully favorable decision, the AC will issue the decision following its usual procedures in HALLEX HA 01380.000 and the instructions below on evaluating fraud or similar fault in the decision, as appropriate.

If the AC is unable to issue a decision, the AC will remand the case for a new hearing and decision.

For example, if the hearing decision did not address whether evidence was being disregarded, but the evidence is identified as "disregarded" in the claim file, and the individual has had the opportunity to object to the disregarding of the evidence at the hearings level, the AC may issue a corrective unfavorable decision that disregards evidence from the source(s) identified in subsection III.B.1. The AC may also issue a favorable decision when an ALJ erred in disregarding evidence and consideration of that evidence warrants a favorable decision (see HALLEX HA 01395.005). When reopening issues are involved, see HALLEX HA 01395.007.

  1. 1. 

    Remand

    If the AC remands the case, the remand order will identify the suspect evidence and instruct the ALJ to make a finding as to whether there is a reason to believe that fraud or similar fault was involved in the provision of evidence.

  2. 2. 

    Decision

    When issuing a decision on a case with a record that contains evidence from Dr. Escabi-Perez, the AC will use the procedures in SSR 22-2p to determine if there is a reason to believe that fraud or similar fault was involved in the provision of the evidence.

    In determining if there is a reason to believe fraud or similar fault was involved in the provision of the evidence, the AC may consider, among other evidence, Dr. Escabi-Perez's plea agreement, the OIG section 1129(l) referrals, Dr. Escabi-Perez's Statement Under Penalty of Perjury, and the S.

    NOTE: 

    SSA generally does not develop evidence of a claimant's intent. Therefore, a finding of similar fault in accordance with SSR 22-2p is sufficient for the AC to disregard the evidence at issue.

    The AC will also use the procedures in SSR 22-2p and HALLEX HA 01395.005 to determine whether to disregard, based on fraud or similar fault, any other evidence individuals or entities, other than Dr. Escabi-Perez, submitted, supplied, or sources. If the AC disregards other evidence based on a fraud or similar fault issue, the AC must ensure the claimant was previously provided the opportunity to object to the disregard of this other evidence, and in the AC decision, clearly address the other evidence, and explain why it disregarded that evidence.

    In all decisions, the AC will specifically explain in the decision that:

    • •

      After an extensive investigation by multiple United States government agencies, a Federal Grand Jury for the District of Puerto Rico indicted psychiatrist Dr. Escabi-Perez, for submitting fraudulent psychiatric medical reports in support of individuals' applications for Social Security benefits. Dr. Escabi-Perez pleaded guilty to charges related to Social Security fraud and admitted to submitting fraudulent psychiatric reports and backdating evidence in medical files of patients who applied for Social Security benefits.

    • •

      As required by section 1129(l) of the Act, in February 2016 and December 2017, the Office of the Inspector General (OIG) notified the Social Security Administration (SSA) that it had reason to believe fraud was involved in the applications for disability benefits of patients seen by Dr. Escabi-Perez. OIG did not identify the claimant's case. However, our own review shows that there is evidence from Dr. Escabi-Perez in the claimant's case file.

    • •

      Under section 205(u) of the Act, SSA must disregard evidence when there is reason to believe fraud or similar fault was involved in the providing of that evidence.

    • •

      Dr. Escabi-Perez provided evidence in the claimant's case, and the ALJ was required to make a finding regarding whether there was a reason to believe that fraud or similar fault was involved in the providing of the medical evidence from Dr. Escabi-Perez [and/or evidence in which a source relied on medical evidence from Dr. Escabi-Perez].

    • •

      [If applicable] The ALJ allowed the claimant the opportunity to object to the disregarding of evidence from Dr. Escabi-Perez. [If applicable] The [ALJ/AC] considered the claimant's objections to the disregarding of evidence. [Explanation for finding].

    • •

      [If evidence was disregarded] The Appeals Council found a reason to believe fraud or similar fault was involved in the providing of evidence from Dr. Escabi-Perez, and the ALJ disregarded that evidence. [Explanation for the finding].

    • •

      [If some of the evidence was not disregarded] The Appeals Council found no reason to believe fraud or similar fault was involved in the providing of the following evidence from Dr. Escabi-Perez and did not disregard those pieces of evidence. [Explanation for the finding].

    • •

      [If no evidence was disregarded] The Appeals Council found no reason to believe fraud or similar fault was involved in the providing of evidence from Dr. Escabi-Perez, and the ALJ did not disregard any evidence. [Explanation for the finding].

    • •

      The Appeals Council considered all of the evidence of record, [if applicable] excluding any disregarded evidence, and decided the case on the remaining evidence.

    • •

      The claimant may appeal the Appeals Council's decision regarding the issue of disability and the disregarding of evidence.

6. Routing

The SRC will handle all AC remand orders for the non-referral Escabi-Perez cases processed under this instruction. When closing out a case in ARPS, OAO staff will ensure that the remand is routed to the SRC and not the originating hearing office.

OAO staff will update the hearing office code under "Final Routing Information" to 5ZU for “Title 2 Routing,” when closing the cases in ARPS and send an email to the SRC at |||DA SRC to alert the SRC of the remand. For paper cases, OAO staff will mail the claim(s) file to the following address:

Special Review Cadre
1718 Woodlawn Drive
Woodlawn, MD 21207

V. Inquiries

OHO staff will direct all program-related and technical questions through appropriate management channels.

OAO staff and adjudicators will direct any program-related or technical questions to the EDO at ^DCARO Fraud Redetermination.

Attachment 2. Dr. Escabi-Perez's Statement Under Penalty of Perjury dated October 23, 2015

Escabi Statement Under Penalty of Perjury

Attachment 3. OIG Section 1129(l) Referral dated February 24, 2016

OIG Referral Escabi 2-24-2016

Attachment 4. OIG Supplemental Section 1129(l) Referral dated December 28, 2017

OIG Supplemental 1129(l) Referral Escabi

To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/2501560005BR
HA 01560.005BR - Puerto Rico (Luis Escabi-Perez, M.D. — Non-Referral Cases; ESNR) (Redacted) -
Batch run: 06/16/2026
Rev: