Oregon resident worked as woman, collected disability as man

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Tuesday, July 21, 2015

PORTLAND, OR -- An Oregon resident who transitioned to a woman more than three decades ago continued collecting Social Security disability checks under her male identity, fraudulently raking in $250,000.

Richelle McDonald was born Richard McDonald in 1945 and obtained a Social Security number under that name as a teenager. In 1974, she applied for and received Supplemental Security Income (SSI) after suffering a paralyzed arm. She had been hit by a San Francisco bus while working as a transvestite prostitute.

McDonald in the 1970s also applied for a separate Social Security number under the name Richelle. She had sex reassignment surgery in 1981, and - despite the arm injury - performed janitorial work as Richelle from the 1980s until 2012.

She never alerted Social Security about the switch and kept collecting disability payments as Richard, providing false statements and forms throughout the decades-long scheme.

McDonald pleaded guilty to Social Security fraud in December and was sentenced Monday to eight months of confinement at her Portland home. She must also pay restitution.

"We understand the struggles she went through in becoming Richelle, but I will still point out that she could be Richard when it was convenient for her," Assistant U.S. Attorney Helen Cooper said.

Cooper, however, recommended that McDonald not serve time in federal prison.

McDonald suffers seizures, has other health issues and would be an expensive inmate for the federal Bureau of Prisons, Cooper said.

Moreover, McDonald cooperated with the investigation and has paid $30,000 of the restitution. The rest will come from the withholding of her Social Security benefits, assuming the 70-year-old lives long enough for that to add up to more than $200,000.

The government discovered the fraud when McDonald tried to claim her retirement benefits. The Social Security number for her female identify listed a birthday several years younger than she claimed to be, leading investigators to do some checking.

U.S. District Court Judge Marco Hernandez told McDonald that Cooper and McDonald's public defender, Renee Manes, worked hard to keep her out of prison.

"Somebody steals a quarter of million dollars, most people think that person ought to go to prison," Hernandez told McDonald. "You understand that?"

McDonald said she understood: "I'm just sorry that I did what I did."

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