Rio Rancho Man Sentenced to 15 Months in Prison for Social Security Scheme

From the U.S. Attorney’s Office, District of New Mexico

ALBUQUERQUE, N.M. – Alexander M.M. Uballez, United States Attorney for the District of New Mexico, announced that James Anthony Sandoval was sentenced to 15 months in prison, and he must pay $55,261.20 in restitution to the Social Security Administration (SSA). A federal jury returned 33 guilty verdicts of theft of government property and one count each of making false statements and false statements on a Social Security form against Sandoval, 58, of Rio Rancho, on Dec. 16, 2022.

A federal grand jury issued an indictment against Sandoval on June 15, 2022. According to evidence presented at trial and other publicly available court records, Sandoval became entitled to receive disability benefits in 2007 and the Social Security Administration (SSA) began issuing payments to Sandoval, including payments to his children and Medicare benefits. In November 2018, the SSA’s Office of the Inspector General (OIG) Cooperative Disability Investigations (CDI) Unit in Albuquerque began an investigation based on an allegation that Sandoval was intentionally concealing from the SSA his ownership, earnings and work activity at Traditions Past and Present, a thriving jewelry business with two locations in Albuquerque.

During the investigation, the CDI Unit determined that Sandoval founded the company in 2009 and was the designer and creator of the jewelry sold by the business. In August 2016, Sandoval signed various SSA forms, under penalty of perjury, in which he stated he had not worked since January 2007 and had not received any income since January 2007.

In February 2019, an undercover agent with the SSA-OIG spoke with Sandoval at the San Antonio Texas Stock and Rodeo show, where Sandoval had rented a vendor booth for his jewelry business. The booth had a sign displayed, “Traditions Past and Present Jewelry, My Heritage and Design by James Sandoval.” Sandoval told the agent he sells customized jewelry from the Santa Fe area and had been selling custom-made jewelry at the San Antonio Stock Show and Rodeo for approximately ten years. Sandoval further stated that his jewelry items ranged from $500-$20,000, and he did not sell his jewelry to wholesalers.

On February 19, 2020, OIG-SSA Special Agent and SSA employees met with Sandoval at the SSA office in Rio Rancho. During the meeting, Sandoval told agents he had not worked since 2002 or 2003, and Sandoval denied making a profit or working at Traditions Past and Present. Sandoval did admit to traveling to trade shows on behalf of the business.

During the trial, the jury heard testimony from a former employee who stated that Sandoval was intentionally concealing his income from the government because he was receiving SSA disability payments. Other evidence presented included reports and photographs of Sandoval working at his jewelry business, Traditions Past and Present, as well as working at a vendor booth for his jewelry business at a trade show in Texas. The government also presented bank records of Traditions Past and Present and Sandoval’s personal bank records from 2014 to 2019 which included several transactions from the jewelry business to Sandoval’s personal accounts, all of which were controlled by Sandoval.

Between January 1, 2014, and April 1, 2019, Sandoval received SSA benefits totaling $182,735.10 and Medicare paid a total amount of $94,165.20 for the services Sandoval received from March 2015 to May 2021, which is the period he was not entitled to receive SSA disability benefits.

“Everyone deserves economic stability and dignity,” said U.S. Attorney Uballez. “Social security funds represent our collective commitment to taking care of our neighbors who can no longer work. When selfish business-owners draw benefits to which they are not entitled, they are stealing from every American’s paycheck and from every lawful beneficiary. Together with SSA-OIG, we will preserve the viability of the Social Security system. This case was spearheaded by OIG Special Agent Bianca Mendez, who tragically died before she could finish her work. Her colleagues at SSA-OIG and CDI finished where she left off and honored her legacy with this outcome.”

Upon his release from prison, Sandoval will be subject to three years of supervised release.

The SSA Office of the Inspector General Albuquerque CDI Unit investigated this case with assistance from the New Mexico Disability Determination Services, the New Mexico Office of Attorney General and SSA. Assistant United States Attorneys Raquel Ruiz-Velez and Kristopher N. Houghton are prosecuting the case.