GAO Finds USDA Improperly Paying Deceased Farmers

The US Department of Agriculture (USDA) has been making program payments to farmers who died more than two years ago. That’s not the problem. The USDA is supposed to do that… sometimes. The problem, says the Government Accountability Office (GAO), is that the USDA has been too often paying the "wrong" dead farmers.

Every year, the USDA pays out over $20 billion in farm program payments to individuals and "entities," including farming corporations, partnerships, and estates. Under certain legal conditions, estates continue to receive payments for the first 2 years after an individual's death. After that, the USDA is supposed to determine that the estate is not being kept open just to continue receiving the farm program payments. However, the USDA failed to make that determination in 73, or 40 percent, of the 181 estates GAO investigated.

Sixteen of the 73 estates checked by GAO had each received more than $200,000 in farm payments, and 4 had each received more than $500,000. In one case, USDA paid an individual -- deceased since 1995 -- over $400,000.

In the USDA's defense, the GAO points out that, "The complex nature of some farming operations—such as entities embedded within other entities—can make it difficult for USDA to avoid making payments to deceased individuals."

The GAO recommended that the USDA implement management controls to verify that farm program payments were not being made to deceased individuals, and in cases of improper payments, recover the appropriate amounts. The USDA agreed.

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