ADMINISTRATIVE PROCEDURE FOR IMPOSING PENALTIES FOR FALSE OR MISLEADING STATEMENTS.

SEC. 207. ADMINISTRATIVE PROCEDURE FOR IMPOSING PENALTIES FOR FALSE OR MISLEADING STATEMENTS. (a) In General.—Part A of title XI of the Social Security Act (42 U.S.C. 1301 et seq.) is amended by inserting after section 1129 the following: “SEC. 1129A. ADMINISTRATIVE PROCEDURE FOR IMPOSING PENALTIES FOR FALSE OR MISLEADING STATEMENTS. “(a) In General.—Any person who makes, or causes to be made, a statement or representation of a material fact for use in determining any initial or continuing right to or the amount of— “(1) monthly insurance benefits under title II; or “(2) benefits or payments under title XVI, that the person knows or should know is false or misleading or knows or should know omits a material fact or who makes such a statement with knowing disregard for the truth shall be subject 113 STAT. 1838to, in addition to any other penalties that may be prescribed by law, a penalty described in subsection (b) to be imposed by the Commissioner of Social Security. “(b) Penalty.—The penalty described in this subsection is— “(1) nonpayment of benefits under title II that would otherwise be payable to the person; and “(2) ineligibility for cash benefits under title XVI, for each month that begins during the applicable period described in subsection (c). “(c) Duration of Penalty.—The duration of the applicable period, with respect to a determination by the Commissioner under subsection (a) that a person has engaged in conduct described in subsection (a), shall be— “(1) six consecutive months, in the case of the first such determination with respect to the person; “(2) twelve consecutive months, in the case of the second such determination with respect to the person; and “(3) twenty-four consecutive months, in the case of the third or subsequent such determination with respect to the person. “(d) Effect on Other Assistance.—A person subject to a period of nonpayment of benefits under title II or ineligibility for title XVI benefits by reason of this section nevertheless shall be considered to be eligible for and receiving such benefits, to the extent that the person would be receiving or eligible for such benefits but for the imposition of the penalty, for purposes of— “(1) determination of the eligibility of the person for benefits under titles XVIII and XIX; and “(2) determination of the eligibility or amount of benefits payable under title II or XVI to another person. “(e) Definition.—In this section, the term ‘benefits under title XVI’ includes State supplementary payments made by the Commissioner pursuant to an agreement under section 1616(a) of this Act or section 212(b) of Public Law 93–66. “(f) Consultations.—The Commissioner of Social Security shall consult with the Inspector General of the Social Security Administration regarding initiating actions under this section.”. (b) Conforming Amendment Precluding Delayed Retirement Credit for Any Month to Which A Nonpayment of Benefits Penalty Applies.—Section 202(w)(2)(B) of such Act (42 U.S.C. 402(w)(2)(B)) is amended— (1) by striking “and” at the end of clause (i); (2) by striking the period at the end of clause (ii) and inserting “, and”; and (3) by adding at the end the following: “(iii) such individual was not subject to a penalty imposed under section 1129A.”. (c) Elimination of Redundant Provision.—Section 1611(e) of such Act (42 U.S.C. 1382(e)) is amended— (1) by striking paragraph (4); (2) in paragraph (6)(A)(i), by striking “(5)” and inserting “(4)”; and (3) by redesignating paragraphs (5) and (6) as paragraphs (4) and (5), respectively. (d) Regulations.—Within 6 months after the date of the enactment of this Act, the Commissioner of Social Security shall develop regulations that prescribe the administrative process for making 113 STAT. 1839determinations under section 1129A of the Social Security Act (including when the applicable period in subsection (c) of such section shall commence), and shall provide guidance on the exercise of discretion as to whether the penalty should be imposed in particular cases. (e) Effective Date.—The amendments made by this section shall apply to statements and representations made on or after the date of the enactment of this Act.