For Better or for Worse

The institution of marriage has long been a sacred ritual between two people in love; however, even this sacred institution is vulnerable to fraud.

February 2013

By Yasmin Vazquez

 

“I, John Doe, take you, Jane Poe, to be my lawfully wedded wife, to have and to hold, from this day forward, for better or for worse, for richer or for poorer, in sickness and in health, until death do us part.” 

 

The institution of marriage has long been a sacred ritual between two people in love; however, even this sacred institution is vulnerable to fraud. There are people who enter into marriage for fraudulent reasons, including tax benefits, health insurance, military benefits, real estate ownership, immigration status and others. Marriage fraud is not an exclusive problem within the U.S., but rather a global issue that CFEs must recognize as an increasingly common occurrence.

 

Tax Breaks 

Rather than the traditional reason of marrying for love, couples might enter into marriage solely for the benefits provided by the government. For example, married couples in the U.S. receive a federal tax break when their incomes are disparately different or when one spouse does not have any income at all. Couples who live together and are not formally married but claim to be in order to take advantage of this tax break may be prosecuted by the government.

 

In 2010, the federal estate tax was approximately 20 percent higher than the federal income tax. For this reason, there were instances when people chose to marry their beneficiary in order to avoid paying the higher estate tax. Regulations were recently modified since discovering this excuse. CFEs must remain vigilant for these loopholes within their own government to deter individuals from using this as an incentive to avoid higher taxes.

 

Health Insurance Benefits 

Sometimes an individual enters into marriage with a stranger or friend for health care benefits. An individual who is employed with a company that provides health insurance will also cover the spouse. Those who are unemployed or self-employed often pay higher premiums, copayments and deductibles than those covered by a larger company that receives a group rate. Even people who are covered in smaller companies could benefit by marrying and transferring to their significant other’s insurance if their rates are lower. An instance where this might occur is a male friend offering to marry a female friend who needs major surgery in order to cover her medical expenses under his company’s health care plan.

 

Military Benefits 

The compensation policies offered by military systems are an impetus for sham marriages. Aside from the obvious medical benefit of free or cheaper health coverage, there are other benefits received through the U.S. military. These include child care subsidies, better mortgage packages, free housing, subsistence allowances, college tuition breaks and discounts or tax-free shopping on the military base. The British Army has similar benefits in place, including subsidized housing and meals, medical and dental health care and pension programs, among others.

 

One instance occurred in 2011 when a female Marine based in California entered into a sham marriage to collect the housing benefit provided by the military. The woman lived with her partner off base, but could not collect the allowance because the two were unmarried and could not wed because the law banned gay marriages. The female Marine found a male Marine willing to marry her, while her partner also entered into a fake marriage with another Marine to collect housing funds.

 

Military pensions might also be a catalyst for preempting a false marriage. An example of this occurred in 2008, when a young lady married her adoptive father, a 69-year-old veteran, in order to take advantage of his lifetime military pension (U.S. v. Dedman).

   

Real Estate Ownership 

In Mexico, foreigners are not allowed to own real estate property. There are a number of Mexican cities that are popular retirement venues for Americans, including San Miguel Allende, Guanajuato and Puerto Vallarta. Americans and other foreigners who retire to Mexico are known to enter into marriage with trusted locals in order to buy retirement property. This includes Mexican-Americans who often have distant relatives in Mexico whom they marry for this purpose.

   

Immigration Status 

Governments worldwide are aware that foreigners marry citizens in order to gain permanent residence within that country. For this reason, new laws and regulations are enforced to essentially “weed out” these scam marriages. For example, Citizenship and Immigration Canada (CIC) enacted new marriage regulations, which went into effect in October 2012, to mitigate this fraud scheme. The rules now entail a requirement for childless immigrant couples to live together for two years in order to gain permanent resident status. The CIC's website provides additional information on the Canadian regulation.

 

Despite its best efforts, incidences of marital fraud still take place within Canadian borders as evidenced by a recent case. In January 2013, seven Toronto-based women were arrested for their involvement in the arrangement of fraudulent marriages between Chinese foreign officials and Canadian citizens. The Canadian Border Services Agency (CBSA) conducted a four-year investigation before finally gathering enough evidence to arrest suspects involved in the setup. The scam included a $30,000 to $35,000 fee for the fraudsters to find Canadian sponsors, arrange weddings and complete all documentation for the foreigners. Each woman arrested is expected to go to trial for violating federal laws, including aiding and abetting persons to commit misrepresentation.

 

In November 2012, a combined effort between the Australian Department of Immigration and Citizenship (DIAC) and Australian Federal Police (AFP) uncovered an operation that arranged fake weddings between Australian women and Indian men. As part of the scheme, the organizers paid money to Australian women so that the Indian men could apply for visa applications to stay in Australia based on the fake marriage. Authorities searched properties where the alleged organizers performed fake weddings and seized additional possessions for further investigation. Nine Queensland properties were seized, and bank accounts linked to the suspected fraudulent marriages were frozen under the Commonwealth Criminal Assets Confiscation Taskforce. The DIAC believes that approximately 50 visas were awarded based on these phony marriages. The DIAC continues to encourage citizens to report immigration and citizenship violations through their website.

 

Exposing Marriage Fraud 

As a CFE investigating whether a marital relationship is a marriage of love or a marriage of convenience, there are several questions that might help determine the answer. These questions include:

 

1. Can the couple provide a marriage certificate?  

 

2. Have temporal requirements been met? Temporal requirements state that a marriage must last a specified period of time for spouses to receive benefits. For example, military pensions are only given to surviving spouses if they had been married one year before the veteran’s death. Another example is Social Security law, which states that a couple must be married at least nine months before a spouse becomes eligible to receive Social Security benefits after the other’s death.

 

3. Does the couple share the ownership of property? 

 

4. Is there documentation of a joint bank account? 

 

5. Can affidavits be obtained from third parties that can confirm the marital relationship? 

 

6. Can the couple pass verbal interviews about their daily married life conducted at random? Examples of personal questions that might be asked include, "On what side of the bed does your spouse sleep?"; "How does he take his coffee?"; "What type of underwear does he wear (e.g., boxers, briefs, or none)?"; "Who is your spouse’s nemesis at work?"

 

Depending on the organization or country of residence, CFEs must tailor their interviews and techniques to uncover sham marriages. By being alert to the techniques used in attempts to get tax breaks, benefits, ownership and immigration advantages, investigators can help uncover more fraud – and prevent marriage from being used as a tool for illegal financial gain.