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Robert Longley

Dead Federal Employees Paid $120 Million Annually

By September 27, 2011

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U.S Treasury Facility Prints Social Security ChecksIt's a well known fact that U.S. government employees get great benefits, but did you know that for at least the last five years, the federal government has been sending benefit checks worth an average of $120 million to retired federal employees who are also, by the way, dead?

This latest revelation of over $601 million in government waste comes in the form of an investigation and accompanying report filed last week by Patrick E. McFarland, the inspector general (IG) of the U.S. Office of Personnel Management.

According to IG's report, Stopping Improper Payments to Deceased Annuitants, the value of benefit checks improperly sent to deceased federal retirees averages from $100 - $150 million annually and has totaled more than $601 million since 2006.

Perhaps even more troubling, the report shows that loss to the government because of these improper "post-death" payments during the last five years has risen at a rate of 70% per year, while the value of total legitimate payments to retirees has increased at a rate of only 19%.

Also See: 5 Outrageous Examples of Waste, Fraud and Abuse

How Improper is Improper? As an example of the improper payments, IG McFarland cites the case of a government retiree's son who continued to get and cash benefit checks until 2008 - a full 37 years after his father's death in 1971. The $515,000 worth of improper payments was only discovered when the son died. The funds were never recovered.

According to McFarland's report, improper payments made by all federal agencies totaled around $125 billion in 2010. Due largely to the recent growth in numbers of unemployment insurance and Medicaid payments, McFarland projects that improper payments will continue to increase by at least $15 billion a year. The government has recovered around $687 million of the $125 billion improperly paid out in 2010.

What to Do About It? A master of understatement, McFarland wrote in his report, "It is time to stop, once and for all, this waste of taxpayer money."

As what he called "only partial remedies at best," McFarland noted that his agency, the Office of Personnel Management (OPM), is now making weekly and yearly audits of its benefits mailing lists comparing them to names in the "Master Death File" maintained by the Social Security Administration.

In addition, OPM recently sent letters to 4,400 of the about 125,000 federal retirees over age 90, basically asking them if they are still alive. To date, notes McFarland, 144 of the 90-and-older retirees who did not respond to the letter have had their benefit mailings suspended pending further investigation.

Perhaps more effectively, OPM is also working with the IRS to identify deceased retirees and taking steps to improve communications with the families of deceased federal retirees.

Also See:
Dead People Got Economic Stimulus Checks

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Photo by William Thomas Cain/Getty Images

Comments

September 27, 2011 at 6:50 pm
(1) mindbird says:

Clearly, this dept. wasn’t “overregulated to death.” Keep slicing the Federal workforce into ribbons, keep tripling the work of each remaining Federal employee and see what happens next.

September 27, 2011 at 7:50 pm
(2) gitagrip says:

No wonder the Government is so far in debt. This is just another example of
the incompetency of people who hold
positions that require more work than they
apparently want to do.
When there is no accountability, they
are free to do whatever and mostly it
ends up being total neglect of the job they
are being overpaid to do.

October 4, 2011 at 10:59 am
(3) Detlef Wieck says:

It takes two to tango, brother. Obviously the people recieving the extra money weren’t honest enough to notify the government about the error. This points to a bigger truth: Throughout history, There have always been humans willing to steal from others. The only reason that we haven’t destroyed ourselves yet is that there are still enough honest people doing their duty, both in government and in civilian life. Honesty comes from core principles which one holds as a measuring tool to choose how to act, even in the face of temptation.

October 22, 2011 at 3:55 am
(4) Ken Huffman says:

You hit the nail on the head gitagrip when referring to the OPM and it’s IG Pat McFarland.

October 9, 2011 at 7:56 pm
(5) Patricia Washington says:

FBI waste Trillions and assassinate foreign leaders and turn countries against each other. They should do an investigation on FBI.

October 22, 2011 at 3:51 am
(6) Ken Huffman says:

What this most evidently points out is the failure of govt. programs and the ineptness of govt. officials like McFarland to examine and identify the problem, to recommend corrections to deficiencies in govt. accounting programs, and as an IG, to follow up to ensure that an agency takes appropriate measures to remediate the problem. Mcfarland has been IGfor 20 years and has never allowed substantive evaluation of Office of Personnel Management program functions. The 37 year example of payments being improperly made to a deceased annuitant might make one ask what was McFarland doing to fix that problem for 18 years of those 37 during which he was IG. The answer is nothing.

October 22, 2011 at 2:38 pm
(7) gitagrip says:

And the saddest part of it is that we
can’t do a darned thing about it other
than to complain to each other.
Seems that “Washington” is most concerned about keeping their cushy part time jobs. They have more recesses than the grade school students get.

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