I-3-2-5.Appeals Council (AC) Final Actions When a Fraud or Similar Fault Issue Is Raised
Last Update: 5/13/14 (Transmittal I-3-65)
A. Denying Review
If the AC determines that the administrative law judge (ALJ) properly addressed a fraud or similar fault issue, and there is no other basis for review under 20 CFR 404.970 and 416.1470, the AC will deny review.
When an issue of fraud or similar fault was not before the ALJ, but is identified by the AC on review, the AC may deny review if:
The fraud or similar fault issue is not material to the issues before the AC; or
The AC determines that the standard of proof for fraud or similar fault is not met (see Hearings, Appeals and Litigation Law (HALLEX) manual I-1-3-15 C).
Denying review for either reason does not preclude the AC from making a referral to the Office of the Inspector General (OIG) when it suspects fraud or another criminal violation. For instructions on when a referral to OIG may be appropriate, see HALLEX I-3-2-9 and I-1-3-0.
B. Granting Review
1. Issuing a Decision
The AC may issue a decision to resolve an issue of fraud or similar fault when:
The file contains sufficient evidence to determine whether similar fault was involved in the presentation of evidence (see HALLEX I-1-3-15); and
A remand is not necessary to decide all adjudication issues involved in the claim.
For example, the AC may issue a corrective unfavorable decision that disregards evidence considered by an ALJ, or may issue a favorable decision when an ALJ erred in disregarding evidence and a favorable decision is warranted when the evidence is considered.
When reopening issues are involved, see HALLEX I-3-2-7.
2. Remanding the Case
The AC will generally remand a case if it is necessary to further develop the evidence regarding possible fraud or similar fault.
In the remand order, the AC will not instruct the ALJ to request or consider an OIG investigation. Rather, the AC's discussion of why evidence is needed must be sufficient to instruct the ALJ on the development that is required.
When appropriate, the AC may indicate in a remand that the medical merits of the case need not be reevaluated.