WASHINGTON, D.C. – Today, Senator Rick Scott wrote a letter to Social Security Administration Commissioner Martin O’Malley seeking answers regarding the oversight and regulation of special needs trusts. Senator Scott’s letter follows disturbing allegations of fraud and misappropriation of $100 million by the founder of the Center for Special Needs Trust Administration in Pinellas County, Florida. In his letter, Senator Scott demands information on the Social Security Administration’s role in the organization and administration of these trusts and their continued compliance with federal law, as well as how the administration coordinates with state government agencies to ensure oversight.

Read the full letter HERE or below.

Dear Commissioner O’Malley:

I was recently made aware of a heartbreaking issue in Pinellas County, Florida, involving the alleged misappropriation of $100 million by the founder of the Center for Special Needs Trust Administration (“CSNTA”), a special needs trust intended to safeguard and manage the assets of disabled individuals who receive Medicaid and Social Security Income payments. The families impacted by this alleged criminal behavior have rightly raised questions about the oversight of these organizations and I write to you today to echo those concerns and urge you to take action that protects these families from fraud.

As you know, organizations like the CSNTA operate as trustees and as such are required to act as fiduciaries for the beneficiaries of the trusts they manage. Importantly, these organizations can be held legally liable for misconduct that violates this responsibility. While the CSNTA’s founder faces criminal and civil investigations for his apparent fraudulent misappropriation of trust monies, and I expect him to be held accountable in a manner which not only punishes criminal activity but also makes the victims of any crimes whole, I also expect the Social Security Administration to act and ensure oversight.

I ask that you immediately respond to the following questions:

1. What oversight does your agency perform relating to both the organization and the administration of “special needs trusts” and “pooled trusts?”
2. What action(s) has your agency taken to address the issues raised regarding the CSNTA?
3. How does your agency coordinate with state government agencies in ensuring oversight of “special needs trusts” and “pooled trusts?”
4. How frequently does your agency review the organization of such trusts to ensure they are complying with the structure defined in federal law?
5. What steps does your agency take to monitor the administration of such trusts?

I appreciate your prompt attention and response to these questions.

###