Amid Some Confusion, Social Security Begins Use of New Anti-Fraud Measures

Social Security will now conduct an anti-fraud check on all phone applications by analyzing “patterns and anomalies within a person’s account.” 

The Social Security Administration on Monday began using its newly enhanced “fraud prevention tools” for claims filed over the phone.

This comes after the agency caused widespread confusion over the last few weeks, as it recently reversed its plans to prevent retirees from completing claims over the phone. 

As of April 14, individuals applying for all claim types who cannot use a personal mySocialSecurity account can complete their claim entirely over the telephone without the need to come into a field office. Previously, the agency had said it would require people to either come in person or complete claims online for “identity proofing” reasons. 

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Social Security will now conduct an anti-fraud check on all phone applications by analyzing “patterns and anomalies within a person’s account.” 

If irregularities are detected, the individual will be asked to complete in-person identity proofing to continue processing their claim.  

“These advancements allow SSA to maintain the security of its services while continuing to expand access for customers who may be unable to file online or visit an office in person,” the SSA wrote in a press release. 

“We are modernizing how we serve the public—enhancing both security and accessibility,” said Leland Dudek, acting commissioner of the SSA, in a statement. “These updates improve our ability to detect and prevent fraud while providing more flexible options for people to access their benefits.” 

Andrew Biggs, senior fellow at the American Enterprise Institute and formerly the principal deputy commissioner of the SSA, says while it is hard to say how applicants and beneficiaries are being impacted by the changes at the SSA at this time, it does appear that wait times and disconnects for SSA’s 800-number have increased. 

“However, it’s not yet clear whether this is due to a degradation of service or because of higher call volumes, likely driven by publicity over changes at SSA,” Biggs said. “So there are chicken-and-egg problems… I suspect that some applicants have been inconvenienced and some beneficiaries are concerned about their benefits, but it’s really not clear what the scale of the issue is yet.” 

Biggs added that the SSA has backed off some proposed changes while introducing others, such as steps to prevent undocumented immigrants from accessing the financial system via SSA’s so-called “master death file.” 

The agency also caused confusion over the weekend, with reports that it is cutting staff from its communications office and would rely on the social media app X to communicate to the press and public. However, the SSA responded to a post on X two days ago, saying the news was false and that Social Security will continue to “communicate through any and all mediums.” 

Talks about downsizing come as the agency is reassigning about 700 employees to field office positions nationwide. Layoffs are also likely to occur under an ongoing federal Reduction in force.  

Last week, U.S. Senators Kirsten Gillibrand, D-New York, and Ron Wyden, D-Oregon, led a group of 21 Democratic senators in a letter calling on the Trump administration and the Department of Government Efficiency to stop their attacks on Social Security. 

According to the letter, SSA had announced plans to slash at least 12% of its workforce and offered buyout incentives to staff.  

The agency announced last week that reports about closing local field offices were false and that since January 1, the agency has not permanently closed or announced the permanent closure of any local field office. 

Private Credit Matures Into Mainstream Asset Among RIAs

An AFA survey of professionals from U.S.-based RIA firms that research funds and/or select funds for client portfolios, found that half of firms are likely to increase their private credit holdings in 2025.

Private credit investments have “no doubt” become a mainstream asset class for registered investment advisers and are poised to grow even further, according to a report from Alternative Fund Advisors, which specializes in interval funds. 

The report is based on a survey conducted by an independent marketing company of 121 professionals from RIA firms in the U.S. that research funds and/or select funds for client portfolios. According to AFA, the survey found that firms are likely to increase their private credit allocations, regardless of how much they currently hold.

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Nearly half (48%) of the respondents said they are very likely or likely to increase their allocations to private credit over the next year, while 34% said they are considering it. Only 18% said they are probably not or definitely not going to increase their private credit allocation. The study also found that 40% of allocators polled said they expect to add at least one new fund to existing private credit portfolios in 2025, while 36% said they are considering it. The remaining 24% said they have no plans to add new funds. Additionally, 45% of RIAs using private credit allocate more than 5% of a typical client’s portfolio to the asset class, with 19%—which AFA refers to as “power users”—allocating at least 10%.

Direct lending is by far the most common strategy used by RIA private credit investors, cited by 74% of respondents, followed by asset-based lending and real estate debt at 42% each. An all-in-one multi-sector approach is used by 37% of respondents, while specialty finance and structured finance are employed by 29% each. While direct lending remains the most prevalent strategy, the surveyed companies indicated that they are looking to invest in strategies that diversify beyond direct lending in 2025.

“Specific strategies targeted for future allocations include asset-based lending, real estate debt, and specialty finance,” the report stated. “Because direct lending dominates current allocations it is not surprising that it tends to be less popular as a 2025 addition.”

Firms are eyeing broad-based multi-sector funds more than other strategies to diversify portfolios, according to responses from 57% of respondents. Asset-based lending was the next most popular choice as a diversifier at 39%, followed by real estate debt and specialty finance at 36% and 35%, respectively. Structured finance drew the least interest, with only 21% saying are likely to adopt the strategy.

“We believe the importance of private credit in client portfolios will only increase in 2025 and beyond,” Alternative Fund Advisors CEO Marco Hanig said in a statement. “Our survey findings validated a trend that we’re seeing in the market—firms have moved beyond owning a single private credit fund. They are now utilizing multiple funds and intentionally diversifying across various sub-segments of the market.”

 

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