A federal judge on Wednesday sentenced a Blythewood man to three years and five months in prison for claiming $1.6 million in Veterans Administration and Social Security disability benefits while pretending he suffered extreme impairments from advanced multiple sclerosis.
Dennis Paulsen, 45, who was indicted last year and convicted after a trial in January, was not taken into custody immediately. He will report to prison at a later date.
“This is the largest single Veterans Administration fraud case that the VA has ever had,” assistant U.S. Attorney Bill Day told U.S. Judge Margaret Seymour just before Seymour sentenced Paulsen at the U.S. courthouse inColumbia.
In all, Paulsen, who started getting fat monthly checks from the VA in 1993, collected some $1.5 million over the years in fraudulent VA disability payments and an additional $133,000 in all in fraudulent Social Security disability payments, Day and his co-counsel, prosecutor Jay Richardson, said.
The $112,000 a year in tax-free government payments gave him, his wife and two sons a well-to-do life at their Blythewood home, prosecutors said. In South Carolina, the median household pretax income is around $45,000, according to the U.S. Census.
Actually, Paulsen did have multiple sclerosis — but only a mild case of it and not the incapacitating case that he claimed, prosecutors said. Or, if he did have a severe case, it was in remission most of the time. Multiple sclerosis, known by its initials MS, is a fatigue-inducing nervous system disease that can affect the brain, spinal cord, vision, and balance.
Just before sentencing Wednesday, Paulsen told the judge that he hadn’t defrauded anyone.
“I don’t believe I am guilty,” Paulsen said in a shaky voice. “I deal with my sickness every day.”
Although he often looks normal to most people, Paulsen went on, he has no feeling in his hands and he tires easily.
On three occasions in the late 1990s, he said to the judge, he told VA doctors that his disease was in remission and he didn’t need such large disability checks. But when the VA kept sending him the checks, Paulsen said, he supposed it was because the VA believed his disease might come back.
Paulsen’s lawyer, Melvin Bannister, told the judge that Paulsen is a ruined man. His disability payments have been cut, his wife has divorced him and his two sons won’t speak to him. “He is also very depressed about going to prison.”
In January, a federal jury took less than two hours to find Paulsen guilty of defrauding both the Veterans Administration and the Social Security Administration.
Evidence presented at Paulsen’s six-day trial showed that Paulsen had for years led a highly active life around Blythewood, playing multiple sports at a high level and even running in the Mud Run in 2008. On the last leg of that mud run, he picked up a stretcher with a person on it and lugged it to the finish line, evidence showed.
Key evidence at the trial was from an Internet blog, written by Paulsen’s ex-wife, Kristine Paulsen, who had inserted photos of her husband playing numerous adult sports and being highly active. She also had written glowing notes about how proud she was of him. Kristine Paulsen also testified, telling the jury Paulsen had told her he was exaggerating his symptoms to game the system, prosecutor Richardson said.
The Paulsens divorced in 2014. After getting a tip that year from a family member of Paulsen’s ex-wife, government investigators looked into the case. They began secretly following him, using a variety of techniques, including surveillance video and undercover agents, and developing human sources to bring what prosecutors said was overwhelming evidence to the trial. Some video was played to the jury, too.
Cases like Paulsen’s are rarely uncovered. After the government diagnoses someone with a disability, the government seldom investigates to verify that someone’s disability is what they claim.
In the early 1990s, Paulsen was diagnosed with 30 percent disability because of multiple sclerosis. He had his impairment rating sharply increased in the late 1990s by the VA. He still gets VA disability checks, only greatly reduced.
“Everyone is entitled to benefits, but what you are not entitled to do is lie, cheat and steal to get them,” assistant prosecutor Richardson told the jury in January.
According to evidence in the case, Paulsen joined the Navy in the late 1980s, hoping to become a SEAL. But Navy doctors determined he had MS and mustered him out. As a veteran, he began getting disability checks. Later, theSocial Security Administration joined in the diagnosis and began sending him an additional monthly check.
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