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National Debt

Social Security Pays Millions to Dead People

  • January 20, 2016

     According to an audit by the Social Security Administration’s (SSA) Office of Inspector General (OIG), the SSA has paid at least 740 dead people $17.1 million in benefits.

     

     

    The OIG based its results on the bank records of 58 deceased individuals, finding that the SSA had put $1,111,000 into their accounts. The SSA only was able to recover $35,000 and “did not attempt to recover payments from the other beneficiaries.” Family members or others can withdraw the funds if they have access to the dead individual’s account.

     

    The audit, released earlier this year found that the federal agency did not try to recover direct deposit payments that went into deceased persons’ bank accounts, and that the number of benefit payments to the dead is likely much higher.

     

    If the search was expanded to the entire beneficiary population, the OIG determined that a low estimate for improper direct deposit payments to dead people amounts to $17,103,880. However, the actual figure is likely higher according to the OIG because they limited their review to individuals in suspense for fewer than 7 years, residing in the United States, and those with higher monthly benefit amounts. Of the OIG’s sample, the SSA only terminated benefits for six individuals, leaving the “remaining 52 in a suspended payment status.”

     

    This is an issue that continues to linger, a 2004 OIG audit that found the SSA gave more than $1 million to 15 deceased individuals, and a recent discovery that the SSA deposited $2.7 million into bank accounts for 28 beneficiaries they were “unable to locate.” The reason for the continued inability to pay only living recipients is due to the fact that the OIG found that the “SSA did not have effective controls to terminate records of deceased beneficiaries and recover direct deposit payments made after the beneficiaries’ deaths. Specifically, SSA’s policy did not instruct its staff to use all available information.”

     

    The major entitlement programs, including Social Security, Medicare and Medicaid, take up almost 50 percent of all federal spending and are only expected to increase in size as more Americans age and retire. Entitlements and net interest are projected to consume 100 percent of the government’s tax revenue by 2030. Discretionary spending such as defense, education and infrastructure are not what accounts for the ballooning federal debt, but rather by growth in mandatory programs such as entitlements.


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